By Lateef Adegbite
Between July and much of August, 2024, Mele Kolo Kyari, Managing Director , Nigerian National Petroleum Corporation, NNPC, now baptized, Nigerian National Petroleum Company Limited, NNPCL, with the passage of the Petroleum Industry Bill, PIB, by the National Assembly, signed into Law by former President Muhammadu Buhari, in August, 2020, and Farouk Ahmed, Chief Executive Officer, CEO, Nigerian Mediumstream, Downstream, Petroleum Regulatory Authority, NMDPRA, had been at war with Aliko Dangote, a Nigerian multi-billionaire business mogul , over the continued importation of, Premium Motor Spirit, PMS, popular, petrol into the country.
The Kano state born multi-billionaire business mogul who owns the North American country of the United States, US, 20 million dollars, world-class petroleum refining company with a capacity to process 650,000 b/d crude oil, to produce 53 million litres of petrol, 34 million of Automotive Gas Oil, AGO, popular , diesel and two million litres of Aviation fuel, including 10 million litres of Dual Purpose Kerosene, DPK, or Kerosene, was said to have asked the NMPDRA, to stop issuing licenses for the importation of petrol into the Nigerian market . He has his reason. This is because the Dangote refinery alone, has the capacity to meet the petroleum products demand of the Nigerian market.
The NMDPRA, Authorities may not have believed that the Dangote refinery can meet the country’s products demand to stop products importation into the country. The Commission had was said to have sounded it loud and clear, that that country would only stop importation, particular, petrol, when at least three to four refineries are working in the country.
NMDPRA and NNPCL, may have run into stormy waters to meet the petrol demands of the country in the recent time resulting in scarcity of the product in different parts of the country, thus forcing the oil octopus to increase the pump price of fuel to near N1,000.00 per litre, amidst complaints by Nigerians.
The fuel scarcity appears to have been noticed in different parts of the country over the last couple of weeks which have been caused as the marketers had shunned loading fuel from the NNPCL’s depots at Apapa , Lagos, the nation’s Commercial nerve centre over alleged N6 billion debt, which the company had blamed on logistics challenges, and flooding to solve the supply shortages of the essential commodity.
Dangote may have taken advantage of the petrol scarcity in the country and the inability of NNPCL, to continue importation of petrol, due to financial constraints and the huge debt owed the marketers to save the country from running into crisis.
On Tuesday, September 3, 2024, Dangote refinery, which many had looked forward to solving the country’s fuel problem, was said to have rolled out the first batch of petrol meant for the local market. Dangote the multi-billionaire business mugol, has every reason to happy that the 650,000b/d, refinery which the oil cabals had tried to sabotage in order to continue the importation of the petrol into the country had failed.
An elated Dangote who could not hide his feelings, was said to have assured Nigerians that there was no cause to worry over the quality of its products. Hear him: We are going to produce good petrol that will match what is produced in any other part of the word, including the US, insisting that no foreign refining company product will beat it in terms of quality.
Althogh the Dangote refinery produced petrol has not hit the Nigerian market as expected but the President of Dangote Industries had said that it was not deliberate. He was said to have told those that cares to listen that the Company product will hit the market as soon as it finalises discussions with NNPCL officials about its product being the sole buyer. The multi-billonaire business mogul, who has given his words that the Dangote refinery will help restore the country’s petroleum products industry and manufacturing , which is an indications of’’ real import substitution’’.
He is optimistic that the company will save foreign exchange, and earn foreign exchange for the country which will stabilize the naira as soon as it starts production for the local market and exports.
The good news is that the NMDPRA, which had been against the Dangote refinery dominating the country’s petrol market, even when it has not started rolling out the product had made a U-turn. The Commission may have known that NNPCL, under the close watch of Kyari has failed the nation in terms of meeting its’ petrol demands that it had bounced back back on the Dangote refinery which it had said will supply the Nigerian market with 25 million litres of petrol daily in this month of September, meaning that the era of importation by NNPCL, is over.The NMDPRA officials had said that starting in the month of October, the 650,000b/d rDangote refinery will be pumping 30million litres of petrol daily into the Nigerian market.
Informed sources told The Value News online Magazine, that on Tuesday, September3 , 2024, officials of NMDPRA and NNPCL, had reached an agreement to commence crude oil sales and supply to the the Dangote refinery in the naira , which energy experts see as a welcome development. The source confirmed that it was an arrangement designed and approved by the Federal Executive Council, FEC, and has nothing to do with NMDPRA or NNPCL.
The Independent Petroleum Producers Group, IPPG, an umbrella Association of indigenous oil and gas companies, were said to have expressed its members objection to President Bola Ahmed led FEC, directive, on mandatory sale of crude oil to Dangote refinery and other local refineries operating in the country in the local currency.
The IPPG, may have known that they cannot change the Federal Government’s decision on the sale of crude oil to the local refineries in naira that they have asked NNPCL , ‘’to redirect its 445,000 b/d. allocated crude oil volumes to Dangote refinery and other local refineries to mitigate the current crude supply shortage being experienced by the local refiners which is expected to impact positively to product availability in the Nigerian market
This volume of crude oil, according to an insider, has always been used, under various swap mechanisms, in the past, to import refined petrol, diesel, Aviation fuel, Dual Purpose Kerosene, DPK, popular, kerosene into the country.
Abdulrazak Isa, Chairman IPPG, would want NNPCL, to treat any national production above its allocated volume strictly as export volumes, adhering to the willing buyer, willing seller framework of the international market .
The IPPG, leadership, argument of insisting of going to sale and supply the excess crude oil to the local refineries to add up to the 445,000 b/d, daily allocated volume for NNPCL, meant for the local market was ssaid to have been based on the prevailing price of crude in the international oil market since the local refiners will need to export the excess products that surpass domestic demand thus boosting their Forex earnings.
Notwithstanding the position of the IPPG, members to sale and supply of crude oil to the multi-billion dollars Dangote refinery in in local currency, the company which could make do with supplies from NNPCL and the international Oil Companies, IOCs, was said to have alrady rolled out the first batch of the Petrol meant for the local market, on Tuesday, September 3, 2024. Vintage Dangote.
