Dangote Refinery set to launch sales of petrol

The Dangote Petroleum Refinery is poised to commence the sale of Premium Motor Spirit (PMS), commonly known as petrol, following a successful test run of its production capacity.

This development marks a significant milestone for the 650,000-barrel-per-day refinery, which has been eagerly anticipated by industry stakeholders and the general public.

Reliable sources within the industry have confirmed that the refinery’s petrol products will soon be available on the market. These sources, speaking on condition of anonymity, indicated that discussions between the Dangote Group and the Federal Government are in advanced stages to finalize the distribution and sale mechanisms.

A key government insider revealed that the distribution process is being meticulously planned to ensure a smooth rollout. Notably, the Nigerian National Petroleum Company Limited (NNPCL) has been identified as the sole entity authorized to sell the Dangote-produced petrol in the initial phase of distribution.

The release of petrol from the Dangote refinery had been delayed due to challenges, including a crude oil shortage and regulatory disputes with the Nigerian Midstream and Downstream Regulatory Authority (NMDPRA), which previously accused the refinery of producing substandard diesel. However, with the Federal Government’s intervention, allowing the refinery to purchase crude oil in local currency, these issues appear to have been resolved, setting the stage for the imminent launch of PMS sales.

This development is expected to have a significant impact on Nigeria’s fuel market, potentially easing supply constraints and stabilizing prices.

News360 Nigeria also recalls that Dangote and other local refineries have repeatedly accused international oil companies of not selling crude to the local refiners.

Recently, the Federal Government announced that the crude oil supply deal would commence in October

The management of Dangote Group also alleged that the IOCs insisted on selling crude oil to its refinery through their foreign agents, saying the local price of crude would continue to increase because the trading arms offered cargoes at $2 to $4 per barrel, above NUPRC official price.

The group also alleged that the foreign oil producers seem to be prioritising Asian countries in selling the crude they produce in Nigeria.

The PUNCH also reported last month that the Dangote refinery engaged in an exchange of words with the Nigerian Upstream Petroleum Regulatory Commission over the alleged supply of 29 million barrels of crude oil to the refinery.

The Dangote Group had accused the NUPRC of failing to effectively enforce the Domestic Crude Supply Obligations regulations, saying the refinery had yet to get enough crude locally.

Reacting, the NUPRC debunked the claim, stating that it facilitated the supply of over 29 million barrels of crude oil to Dangote from January to June 2024.

The NUPRC argued that it had facilitated the domestic supply of crude oil to Dangote refinery and other refineries using the monthly production curtailment platform.

But in a swift response, the Dangote Group also denied receiving 29 million barrels of crude from any source.

Spokesperson of the Dangote Group, Anthony Chiejina, said, “We received NUPRC’s statement that they have facilitated the allocation of 29 million barrels of crude oil to the Dangote Petroleum Refinery and Petrochemicals, we would like to thank them for this allocation but at the same time, we wish to let them know that we are yet to receive these cargoes.

“Aside from the term supply we bilaterally negotiated with NNPCL, so far NUPRC has only facilitated the purchase of one crude cargo from a domestic producer. The rest of the cargoes we have processed were purchased from international traders.”

Chiejina added that all the refinery was asking for was for refineries in Nigeria to buy crude directly from the companies that produce it in Nigeria rather than from international middlemen.

Nigerians are hopeful that Dangote will crash the pump price of PMS.

(Punch)