The source of the fire, which consumed millions of naira worth of property, was traced to a power surge.
The surge occurred around 4.25p.m while the two-time former ruler of Nigeria was out of the house.
The fire broke out in his private office near his bedroom.
The state fire service responded swiftly and was able to put down the blaze. The fire was said to have started barely 20 minutes after Obasanjo left the house for an undisclosed place. He was however said to have hurriedly returned to his burning building to supervise those fighting to quench the fire.
Obasanjo was unruffled when newsmen approached him for comments.
He and his wife, Bola, had celebrated the annual Ibogun Olaogun Day in his ancestral hometown on Boxing Day
A source said one of the aides to the retired general noticed smoke bellowing from a section of the mansion about 4.10pm.
The aide was said to have raised the alarm to attract the attention of other occupants of the building, including security officials, who quickly moved to stop the fire from spreading to other part of the house.
The raging inferno however got out of hand and the State Fire Service and the Nigeria Security and Civil Defence Corp were called in for help.
Our correspondent also learnt that before the arrival of the firefighters and the NSCDC officials, some of the workers had made attempts to climb up the building in an attempt to put out the fire.
By the time the firefighters and civil defence officials arrived at the mansion, our correspondent learnt that the fire had spread to other parts of the building, said to include the bedroom of the former President.
Plainclothes policemen denied access to the residents of the area who thronged the house from entry.
Among the early callers at the building was the state Commissioner of Police, Ikemefuna Okoye; the state Director, State Security Services, Mr. Joseph Okoh; former Minister of Finance, Dr. Onaolapo Soleye; and some officials of the state government.
." He then burst into singing in Yoruba and in his usual comical and jocular manner, he sang, Ile Obasanjo to jo, ewa lobusi, meaning (Obasanjo’s house that’s razed by fire will become more beautiful). In a swift reaction to Journalist The Former Nigeria President, Chief Olusegun Obasanjo, has described the fire at his Abeokuta home on Thursday as a minor one which only affected the office of his Personal Assistant.Obasanjo, who was not at home at the time, was not sure of the cause of the incident, telling the News Agency of Nigeria (NAN), “It may have been some electrical problem.”
NAN quoted him as saying of the incident, “Ile Obasanjo to jo e wa lo bu si,’’ which means, “The fire incident will only add beauty to Obasanjo's house.”
Observers say that as one of Nigeria’s wealthiest men, Obasanjo clearly meant that he will take the opportunity to upgrade the quality of the edifice.
According to the general himself, when he left prison in 1998 he was worth only N20,000 (about $1300). He left office in 2007 an astoundingly rich man. Even his farm, which was dying during his imprisonment, was in November 2004 confirmed by his spokesman, Femi Fani-Kayode to have recovered during his presidency and to be making about N30 million ($250.000) per month.
It would be an irony of sorts should the fire in his mansion today be traced to an “electrical” fault. In his eight years in power, Obasanjo frittered about $16 billion into the hands of contractors and associates in “search” of electricity. None of the money has been accounted for, and the House of Representatives found that some of those who received money did not even clear the land on which they were supposed to have been conducting business or building power plants.