Marketers have demanded direct access to Premium Motor Spirit (petrol) from the Dangote refinery, criticising the firm grip of the Nigerian National Petroleum Corporation on the market.
The National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria, Chinedu Ukadike, said the market should be open for all in line with the willing-buyer and willing-seller commitment earlier made by the corporation.
The NNPCL had last Saturday said it was not the sole off-taker of products from the Dangote refinery, adding that the refinery was free to sell its petrol to any marketer.
But a week after the statement, the Federal Government announced that the company would be the sole buyer of petrol from the refinery.
At a press briefing in Abuja on Friday, the Minister of Finance and the Coordinating Minister of the Economy, Wale Edun, noted that interested marketers would have to buy the product from the national oil firm through its trading company.
The minister, represented by the Executive Chairman of the Federal Inland Revenue Service, Dr Zacceus Adedeji, also announced that the Dangote refinery would commence the distribution of petrol to marketers on Sunday with an initial 25 million litres per day.
He said, “I am glad to announce that all agreements have been put in place, and the loading of the first batch of PMS, as already announced by NNPC, will commence on Sunday, September 15, 2024. And from October 1, NNPC will commence the supply of crude oil to the Dangote refinery to be paid in naira.
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“In return, Dangote refinery will supply PMS and diesel of equivalent value to the domestic market to be paid in naira. But for now, PMS will only be sold to NNPC. NNPC will then sell to various marketers.”
Reacting, Ukadike said the market should be liberalised.
“It should be open for all in line with the willing-buyer and willing-seller comments made by the NNPC. We are also looking at how to build our logistics and come up with our price,” he stated.
Also, the National President of the Petroleum Products Retail Outlets Association of Nigeria, Billy Gillis-Harry, raised concerns over the risks of creating a new domestic monopoly in the oil and gas sector.
Gillis-Harry said, “Right now, even on Saturday, that business (petrol) is going to start rolling out tomorrow (Sunday), we don’t know what the price might be. Nobody has informed us about anything; we are not aware of what the government is doing.
“We don’t know any of the pricing templates yet or the matrix that will bring about the pricing template. We have been asking Dangote or anybody that is in charge of this transaction to be transparent, but somehow, we have not got any of that information.
“We are about to leave NNPC monopoly from importation and now we are also going to have that in a domestic environment, that portends danger for the industry.”
Intel Region reported that the NNPC on Saturday said it had mobilised 300 trucks to lift PMS from the Dangote refinery today.
The spokesperson for the corporation, Olufemi Soneye, told one of our correspondents that the mobilisation of trucks to the refinery was based on the agreement reached by both parties as regards the lifting of petrol from the $20bn Lekki-based facility.
In a post on his official X handle that showed some trucks lining up at the refinery, Soneye said, “NNPC Ltd trucks are arriving at the Dangote refinery in preparation for the scheduled petrol loading on Sunday, September 15, 2024. By the end of today (Saturday), at least 300 trucks will be stationed at the refinery’s fuel loading gantry.”
Oil marketers confirmed that the NNPC had started moving trucks to the plant to load products, adding that the national oil company would also load PMS using its vessels.
They also noted that the price of Dangote petrol had not been made public yet, stating that independent marketers would only buy the commodity from the NNPC for now.
The National Operations Controller of IPMAN, Mustapha Zarma, said, “Independent marketers have not been given any offer by Dangote to ascertain the actual off-take price.
“So, for now independent marketers will be taking the product from NNPC, but hopefully in the next few weeks, we may start getting it directly from Dangote.”
Zarma noted that the NNPC would offtake the product from the Dangote refinery using tankers and ships that would move the PMS to coastal depots in Warri and Port Harcourt.
Dangote to sell petrol at N766/litre
Dangote Refinery is set to sell petrol to the Nigerian National Petroleum Company (NNPC) at N766 per litre, according to multiple sources from the Federal Ministry of Petroleum Resources, NNPC, and major energy marketers. A key factor influencing this price is the agreement to supply crude oil to Dangote in naira.
Industry insiders likened the deal to the former Direct Sale of crude oil and Direct Purchase of petroleum products (DSDP) arrangement between NNPC and foreign refineries. “This agreement has had a positive impact on the price of petrol from Dangote, keeping it around N766 per litre,” said a major energy marketer, who requested anonymity. However, the source added that it was unclear how much NNPC would sell to other marketers.
A senior aide to President Bola Tinubu also confirmed that Dangote’s petrol price would be N766 per litre
Possible Pump Price Reduction
Commenting on the price, a senior official from the Independent Petroleum Marketers Association of Nigeria (IPMAN) suggested that with the cost of transportation and other factors, petrol could be sold at around N790 per litre in Lagos and N820 in northern regions due to the distance.
Chinedu Okoronkwo, President of the Petroleum Retail Outlets Owners Association of Nigeria (PETROAN), said, “If we can purchase at N766, it is cheaper than the N870 per litre we currently pay to NNPC.” He added that while the final retail price is yet to be determined, the group is ready to support Dangote if engaged.
However, Okoronkwo expressed disappointment that Dangote Refinery had not yet opened discussions with retail outlets. “We have over 6,000 retail outlets under my management, but Dangote is not talking to us,” he said.
