Dangote Refinery To Dump Nigerian Market, Export Fuel
In a surprising turn of events, the Dangote Refinery may soon abandon the Nigerian market for foreign buyers, as tensions rise between the refinery and the Nigerian National Petroleum Company Limited (NNPC).
The standoff stems from the NNPC’s refusal to commit as a sole buyer unless Dangote’s petrol prices undercut global rates, despite earlier claims by Dangote Group President, Aliko Dangote, that the refinery was poised to flood the local market with fuel.
NNPC’s stance, outlined in a statement by its spokesman Olufemi Soneye, has fueled fears that Nigerians will miss out on cheaper fuel, with many now watching as the refinery eyes foreign markets to stay profitable.
The oil giant’s refusal to act as a distributor or price-setter for Dangote products has cast a cloud over earlier hopes that local refining would bring relief to the country’s ongoing fuel crisis.
“The pricing of petroleum products is determined by global market forces. If prices in Nigeria remain low, there’s no reason Dangote Refinery shouldn’t sell abroad where demand and prices are higher,” said Soneye, effectively confirming that Dangote’s long-anticipated petrol might be shipped overseas.
But speaking on the Brekete Family live show on Monday, the Vice President of Oil and Gas at Dangote Industries Limited, Devakumar Edwin, said Dangote petrol would be exported if the NNPC and other petroleum dealers in the country refused to patronise it.
Asked if the petrol would be sold locally, Edwin replied, “There has been a kind of a blockade from lifting our products within the country. The traders have been trying to blockade, and so now, we have been exporting our petroleum products. We are ready to pump in PMS as much as possible to the country.
“But if the traders or NNPC are not buying the product, obviously we will end up exporting the PMS as we are doing with the aviation jet and diesel,” he declared.
Edwin expressed surprise that the company started facing challenges it never expected when the refinery was set to commence operations.
He recalled that the philosophy initially was to add value to the raw materials available in the country, regretting that Nigeria was still exporting crude and importing refined petroleum products after over three decades.
Despite having a gantry that can load 2,900 tankers per day, Edwin disclosed that the refinery had not loaded up to five per cent of the gantry’s capacity owing to low local patronage.
As the NNPC reiterates its unwillingness to play a middleman role, black market fuel prices in states like Benue and Nasarawa have already skyrocketed to between N1,200 and N1,400 per liter.
The standoff has sparked disappointment across Nigeria, as many were counting on Dangote’s refinery to stabilize the volatile fuel market. Now, with negotiations at a standstill, the hopes of cheaper fuel are quickly fading
