Reactions As NNPCL Announces End To Importation Of Fuel, Says It is Now Buying From Dangote Refinery

The New Diplomat
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By Abiola Olawale

The Nigerian National Petroleum Company Limited (NNPCL) has ceased its imports of refined petroleum products and has shifted its focus to sourcing fuel directly from the Dangote Petroleum Refinery, owned by Africa’s richest man and business mogul, Alhaji Aliko Dangote.

NNPC’s Group Chief Executive Officer, Mele Kyari, made this disclosure on Monday during his address at the conference of the Nigerian Association of Petroleum Explorationists, which was held in Lagos and themed ‘Resolving the Nigerian Energy Trilemma: Energy Security, Sustainable Growth and Affordability’.

Kyari revealed that, as of today, the NNPCL is no longer reliant on imported fuel, maintaining that the company has shifted its focus to sourcing fuel directly from local refineries.

He said: “Today, NNPC does not import any product, we are taking only from domestic refineries.”

Kyari also addressed and refuted the allegations that the NNPCL was intentionally sabotaging the functioning of the Dangote refinery. He clarified that these accusations were baseless and identified a concerning trend in the media, which painted the NNPCL as an adversary to the advancement of domestic refining efforts.

He emphasized the importance of dispelling what he described as “misconceptions”, asserting that the NNPC remains fully committed to promoting and supporting domestic refining initiatives that are vital for the country’s economic growth and energy independence.

He added: “The point is very far from it and I’m going to speak to it straight. We are very proud part-owners of Dangote refinery, no doubt about it. We saw an opportunity that there is a clear market for at least 300,000 barrels of our production; we know that as time moves on, people will start struggling to find markets for their production.

“It will happen, It’s already happening. Oil is found, as you know, in many unexpected locations across the world and people have choices. Therefore we saw an opportunity to log supply to the domestic refinery, not just Dangote but any other refinery that operates in the country, so it was a very informed business decision.

“Therefore, from day one, we knew that it is to our benefit to supply crude oil to the domestic refinery, so we don’t need to be persuaded; we don’t need anyone to talk to us, there is no need for any pressure from the streets for us to do this. We are already doing this,“ he clarified.

On the request that Nigeria needs to domesticate its oil, he posited that Nigerian crude is ’Lamborghini crude ‘, so the products would be pricey.

According to Kyari, the issue of high-quality fuel should be a relative thing, saying many refineries do not patronise Nigerian crude because of the price.

He revealed that some global traders buy the crude and blend it with dirtier fuel to save cost.

He continued: “We should never forget that Nigerian crude is ’Lamborghini crude’, if we choose that every product that we have in this country must come from domestic production, then we must deal with pricing. Otherwise, out there in the global market, everybody buys Nigerian crude and blends it with dirtier crude to process, a lot of you will confirm this. So, no one takes Nigerian crude except one or two refineries that I know. Straight processing of Nigerian crude, nobody does this, because you do have a gap in value if you do this.

“Therefore, as a country, and I believe this strongly also, that we must process all the crude that we produce in the country to the optimum. You can do intermediate products and sell to the market, you are still adding value. You don’t have to sell gasoline that is coming from Nigerian production.

“You can do something different so you can process it domestically, but it’s going to be high quality. As we all know and it’s very clear in the media that we are selling high-quality products, that’s very true but you need not do this. You are driving a Keke-Napep, and you want Lamborghini fuel; you do not need it. So, the quality issue is a relative thing; it’s by geography and location, and we will do everything possible to make sure that we domesticate this.

“Today, NNPC does not import any product, we are taking only from domestic refineries. But I also know that we are working jointly with the government to make sure that we manage the issue around prices if we have to source all our supply from the domestic market. It will be an issue and we are already resolving it. I can confirm that substantial work has been done and this will no longer be an issue.”

It would be recalled that the $20bn Lekki-based Dangote refinery commenced the release of Premium Motor Spirit, popularly called petrol, into the Nigerian market on September 15, 2024.

However, since the development, there has been a huge debate between oil marketers and Dangote Refinery, particularly on pricing issues.

On November 1, the Independent Petroleum Marketers Association of Nigeria (IPMAN) said petrol from the refinery is purportedly more expensive than buying from other sources.

But, Dangote refinery rejected the claim, saying the price of its petrol is far cheaper than the imported ones.

The company said its ex-depot price of petrol is N990 per litre for trucks and N960 per litre for ships.

The refinery also added that any oil marketer that sells petrol cheaper than the price it offers is importing substandard products.

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