Fuel Importation Continues in Nigeria
The Federal Government has decided that the importation of refined petroleum products into Nigeria will continue alongside the Dangote Petroleum Refinery‘s production of the commodities in order to prevent monopolies and ensure energy security.
It advised against becoming overly reliant on the $20 billion refinery in Lagos’ Lekki Free Zone, pointing out that the refinery’s insistence that all oil marketers purchase products from the plant undermines competition.
This comes as the House of Representatives formed an ad hoc committee to investigate claims of non-delivery of crude oil to the Dangote refinery, after oil marketers accused International Oil Companies operating in Nigeria for failing to sell crude to indigenous refiners.
The Nigerian Upstream Petroleum Regulatory Commission also commented on the issue, insisting that it was doing everything possible to secure crude supplies to Dangote refinery and other modular refinery operators, as it committed to settle the lingering dilemma.
The Nigerian Midstream and Downstream Petroleum Authority, a Federal Government department, stated that the government would not halt petroleum product imports, arguing that Nigeria cannot rely on a single refinery to feed the country.
Farouk Ahmed, Chief Executive of NMDPRA, revealed this in Port Harcourt when addressing journalists, and a video of his remarks was made available to one of our correspondents on Thursday.
Ahmed further denied assertions made by the Dangote Group that international oil corporations were causing problems for the refinery by denying it crude supply, stating that this was not the case.
He also revealed that the Dangote refinery, which had been selling diesel and aviation fuel in Nigeria for months, had not been licensed, and that it was still in the pre-commissioning phase.
“Some media outlets have claimed that efforts were taken to shut down the Dangote refinery, but this is not true. The Dangote refinery is currently in the pre-commissioning stage. It has not yet been licensed, nor have we licensed them. They are still undergoing pre-commissioning. Ahmed stated, “I believe they are about 45 percent complete.”
The NMDPRA CEO warned that Nigeria cannot rely solely on the Dangote refinery for fuel supply.
According to him, the refinery had demanded that the regulator stop issuing import licences to other marketers in order to become Nigeria’s exclusive fuel supplier.
“We cannot rely heavily on one refinery to feed the nation because Dangote has requested that we ban or halt the importation of all petroleum products, particularly AGO, and send all marketers to the refinery, which is not good for the nation’s energy security. And that is bad for the market because of monopolies,” he emphasized.
Meanwhile, the House of Representatives has formed an ad hoc committee to investigate claims of non-supply of crude oil to Dangote Refinery and Petrochemical Limited.
This came after the House’s Minority Leader, Kingsley Chinda, submitted a resolution of urgent public interest in plenary on Thursday.
Chinda, who represents Obio Akpor Federal Constituency, Rivers State, had in a motion on “Need to investigate alleged conspiracy by international oil companies to frustrate the operations and survival of Dangote Refinery and the actual percentage holding of the Federal Government in Dangote Refinery,” told his colleagues that the management of Dangote refinery recently accused IOCs operating in the country of conspiracy, “in an attempt to frustrate the smooth operations”
He stated, “The alleged conspiracy against the Dangote refinery relates to efforts by the IOCs to deliberately frustrate the refinery’s ability to buy local crude oil by manipulating and jerking up the premium price above the market price, thus forcing the refinery to reduce output and import crude oil at very exorbitant cost from other countries, such as the United States, thereby, increasing the cost of production locally and increased product price.”
He further accused the IOCs of purposefully preventing the Dangote refinery from purchasing oil at a time when the Nigeria Upstream Petroleum Regulatory Commission was making every effort to allocate petroleum to the company.
The Peoples Democratic Party chief urged appropriate government agencies, the NUPRC, and other key stakeholders to help the refinery thrive.
Chinda stated, “While the Federal Government of Nigeria subscribed to 20% shares in Dangote Refinery, the Chairman (Aliko Dangote) has claimed that Nigeria was unable to redeem its obligation and now owns 7.2% through the Nigerian National Petroleum Company Limited.”
