Dangote Refinery Faces Uncertainty Amid NNPCL's Conflicting Statements

The $20billion Dangote Refinery is currently embroiled in a complex situation with the Nigerian National Petroleum Company Limited (NNPCL), leading to significant uncertainty about its petrol sales. This development has raised concerns among Nigerians and international stakeholders alike.

NNPCL denied claims that it would be the sole buyer of petrol from the Dangote Refinery. In a statement by its spokesperson, Olufemi Soneye, NNPCL clarified, "The state-owned oil firm will not be the sole buyer of Dangote’s petrol." This was in response to allegations from the Muslim Rights Concern (MURIC) that NNPCL was undermining the refinery by hiking petrol prices at its retail outlets to N897 from N617 per liter.

MURIC argued that this price hike was intended to prevent Dangote Refinery from offering Premium Motor Spirit (PMS) at lower prices. However, NNPCL countered this claim, stating that the refinery's prices are determined by global market forces and that the recent pump price increase does not impact the refinery. "If current prices are perceived as high, it presents an ideal opportunity for the refinery to sell its products at lower prices in the Nigerian market," NNPCL added.

Contradicting NNPCL's stance, Aliko Dangote, President of Dangote Refinery, had earlier announced that the rollout of the refinery’s petrol was dependent on NNPCL. He stated, "Dangote Petrol will be ready in 48 hours, depending on NNPCL."

Further complicating the issue, NNPCL mentioned that it would fully purchase PMS from the Dangote Refinery only if market prices are higher than local pump prices. This position poses a serious challenge to the refinery, which has a capacity of 650,000 barrels per day. The question of who will buy Dangote Refinery’s petrol remains unresolved, causing anxiety among stakeholders.

Earlier, NNPCL had announced plans to lift petrol from the refinery starting September 15. However, the latest developments have cast doubt on this timeline. Devakumar Edwin, Vice President of Oil and Gas at Dangote Industries Limited, hinted at the possibility of exporting Dangote petrol if local petroleum dealers, including NNPCL, refuse to patronize it.