By Our Correspondent
The Dangote Oil Refinery, located in Lagos, Nigeria, is set to make a significant impact on the country’s energy sector by supplying 25 million litres of petrol daily starting from September.
This development has been confirmed by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), which announced that this supply volume will increase to 30 million litres per day beginning October 2024.
The agreement for this supply was reached following a meeting between the NMDPRA and the Nigerian National Petroleum Company Limited (NNPCL).
The NNPCL has committed to supplying crude oil to the Dangote Refinery in local currency, which is expected to streamline operations and enhance local production capabilities.
Aliko Dangote, president of the Dangote Group, officially announced the commencement of petrol production at the refinery during a live broadcast.
He expressed optimism about how this initiative would transform Nigeria’s energy landscape and reduce reliance on imported fuel. The refinery has a processing capacity of 650,000 barrels per day, which positions it as a key player not only in meeting domestic demands but also catering to needs across Sub-Saharan Africa.
The initial supply of 25 million litres of Premium Motor Spirit (PMS) into the domestic market is anticipated to significantly alleviate fuel shortages and stabilize prices within Nigeria.
Furthermore, with plans to ramp up production to 30 million litres daily from October 2024, the refinery aims to ensure consistent availability of petrol for both consumers and businesses.
Already the NNPC is anticipating putting a stoppage to its importation of petroleum to Nigeria, as the price rises above N1,000/litre in filling stations.
This comes as protesters hit the streets of Abuja on Monday demanding the immediate dismissal of the company’s Group Managing Director, Mele Kyari, over the lingering fuel scarcity in the country.
It was gathered that the NNPC had informed oil marketers about the financial strain regarding the importation of petrol.
This raised concerns among dealers, who expressed worry over the possibility of a halt in the importation of petrol by NNPC.
NNPC’s spokesperson, Olufemi Soneye, had earlier declared that the national oil company was facing financial strain.
NNPC is the sole importer of PMS into Nigeria, shouldering subsidies on the commodity running into several trillions of naira.
“NNPC Ltd faces financial strain due to PMS supply costs, impacting supply sustainability. NNPC Ltd has acknowledged recent reports in national newspapers regarding the company’s significant debt to petrol suppliers.
This financial strain has placed considerable pressure on the company and poses a threat to the sustainability of fuel supply.
“In line with the Petroleum Industry Act, NNPC Ltd remains dedicated to its role as the supplier of last resort, ensuring national energy security.
We are actively collaborating with relevant government agencies and other stakeholders to maintain a consistent supply of petroleum products nationwide,” Soneye stated on Sunday.
Marketers said officials from the oil company had informed petrol dealers of the development, stressing that this may further lead to a hike in the pump prices of petrol in the coming weeks.
“Now, only NNPC Trading imports petrol, and they have come out frankly to inform marketers that they can no longer sustain it, which means they are subsidising the product all this while,” the National Publicity Secretary, Independent Petroleum Marketers Association of Nigeria, Ukadike Chinedu, stated.
“Of course, the cost of petrol at the pumps may rise further in the coming weeks because up till now we are not getting enough products. So, something urgent and drastic needs to be done to tackle this challenge now.”
