BREAKING: Dangote petrol may sell over N800 per litre

There are rising hopes for cheaper Premium Motor Spirit (PMS), commonly known as petrol, as the Nigerian National Petroleum Corporation Limited (NNPCL) is set to begin lifting petrol from Dangote Refinery.

Sources suggest the product could sell between N857 and N865 per litre at filling stations once distribution begins.

NNPCL, the sole off-taker from Dangote Refinery, is expected to lift the product at N960/N980 per litre and sell it to marketers at N840/N850, allowing for a possible reduction in pump prices across the nation.

Currently, petrol sells for N855 per litre at NNPCL retail stations in Lagos, with major marketers offering prices around N920. Independent marketers sell petrol for over N1,000, and prices in other parts of the country are reported to exceed N1,200 per litre.

Negotiations

Sources said the new arrangement from the NNPCL and Dangote Refinery negotiations, spanning more than one week, would allow Nigerians to get petrol at between N857 and N865 per litre and represents an average under-recovery of about N130 to NNPCL.

President Bola Tinubu, Sunday Vanguard was made to understand by a Presidency source, made it clear to the negotiating parties that “the price at which petrol would be sold to Nigerians should not be such that would place heavy financial burden on them while dealing with the new reality of the prevailing price”.

The Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, has, meanwhile, expressed optimism that the deal would reduce the pressure on foreign exchange (FX) demands and shore up the value of the Naira – presently, between 30% and 40% of FX demands go into the importation of PMS.

Chief Corporate Communications Officer, NNPC Ltd., Olufemi Soneye, who confirmed the readiness of the company to start lifting petrol today, told Sunday Vanguard, yesterday: “NNPC Ltd has started deploying our trucks and vessels to the Dangote Refinery to lift PMS in preparation for the scheduled lifting date of September 15th, as set by the refinery.

“Our trucks and personnel are already on-site, ready to begin lifting. We expect more trucks, and the deployment will continue throughout the weekend so we can start loading as soon as the refinery begins operations on September 15, 2024.”

300 trucks

Soneye hinted that at least 100 trucks had already arrived at the refinery for the petrol lifting, adding that the number of trucks could increase to 300 by Saturday evening.

On his part, Executive Secretary, of Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN), Olufemi Adewole, said: “We have been lifting diesel (AGO) and aviation fuel (jet fuel) and we look forward to lifting petrol (PMS).”

On pricing, he said: “We await clarity in respect of the pricing mode, and once that is clarified, we’ll do the needful towards meeting the energy needs of Nigerians.”

Edun, the Minister of Finance and Coordinating Minister of the Economy, yesterday, said the structuring of the NNPCL, Dangote Refinery deal in Naira would assist in reducing pressure on the local currency.

A statement by the Director of information and Public Relations in the ministry, Mohammed Manga, stated: “In a landmark move towards reducing pressure on the Naira, eliminating unnecessary transaction costs, and improving availability of petroleum products, the Federal Government has successfully initiated the sale of crude to local refineries as well as corresponding purchase of petroleum products in Naira.

“The Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, disclosed this today in his office in Abuja shortly after the Technical Sub-Committee meeting on the sale of crude oil to local refineries in Naira.

“Represented by the Executive Chairman, Federal Inland Revenue Service (FIRS), Dr Zacch Adedeji, the Minister announced the completion of all agreements and modalities for the implementation of the Federal Executive Council (FEC) approval on the sale of crude to local refineries in Naira and corresponding purchase of petroleum products in Naira.

“Recall that the FEC under the leadership of Mr. President approved the sale of crude to local refineries in Naira and corresponding purchase of petroleum products in Naira.

Pressure on Naira
“This initiative will help reduce pressure on the Naira, eliminate unnecessary transaction costs, and improve the availability of petroleum products in the country.

“Since then, the implementation committee chaired by the Hon. Minister of Finance and the technical committee have worked intensely with NNPCL and Dangote Refinery to fashion out the details of the modalities for the implementation of the FEC approval.

“I am glad to announce that all agreements have been completed and loading of the first batch of PMS from the Dangote Refinery will commence on Sunday 15th September. From 1st October, NNPC will commence the supply of about 385kbpd of crude oil to the Dangote Refinery to be paid for in Naira.

“In return, the Dangote Refinery will supply PMS and diesel of equivalent value to the domestic market to be paid for in Naira. Diesel will be sold in Naira by the Dangote Refinery to any interested off-taker. PMS will only be sold to NNPC; NNPC will then sell to various marketers for now.”

The agreement, according to analysts, was expected to ease the severe shortage of petrol across the country and probably bring the price which has skyrocketed recently down.