Dangote Stops Petrol Sale In Naira, Gives Condition For Resumption
Nigerians may experience an increase in the prices of premium energy products diesel and petrol as the Dangote Petroleum Refinery temporarily halts the sale of petroleum products in Naira. “This decision is necessary to avoid a mismatch between our sales proceeds and our crude oil purchase obligations, which are currently denominated in US dollars,” the company said in a statement on Wednesday. People wait to refill their jerrycans and fuel tanks at a fuel station in Lagos on September 4, 2024. (Photo by FAWAZ OYEDEJI / AFP) The $20bn refinery based in Lagos said the sales of its products in Naira have exceeded the value of Naira-denominated crude it has received from the Nigerian National Petroleum Company Limited (NNPCL). “As a result, we must temporarily adjust our sales currency to align with our crude procurement currency,” the company explained. Dangote Gantry at the Dangote Refinery The refinery said it remained committed to serving the Nigerian market and would resume the sale of its product to the local market in Naira as soon as it received crude cargoes from the NNPCL in Naira. “As soon as we receive an allocation of Naira-denominated crude cargoes from NNPC, we will promptly resume petroleum product sales in Naira,” it said. The announcement by the refinery comes amid its price war with the NNPCL. As part of moves to reduce the strain on the US dollars, and guarantee price stability of petroleum products, the Federal Executive Council (FEC) in July 2024, directed the NNPCL to sell crude oil to Dangote Refinery and other local refineries in naira and not in United States’ greenback. In the beginning of March 2025, the NNPCL said its Naira-denominated crude sales agreement with the Dangote Refinery was structured for six months with March 2025 as the expiration date. The state company, however, said that talks were on to replace the contract, and that over 48 million barrels of crude oil have been made available to Dangote Refinery since October 2024 under the Naira-denominated arrangement. The NNPCL also said it had made over 84 million barrels of crude oil available to the private refinery since it commenced operations in 2023. Nigeria, Africa’s most populous nation, faces energy challenges, with all its state-owned refineries non-operational for decades until 2024. The country was heavily reliant on imported refined petroleum products, with the state-run NNPCL being the major importer of the essential commodities. Fuel queues are commonplace in the country. Prices of petrol more than quadrupled since the removal of subsidy in May 2023 by President Bola Tinubu, from around ₦200/litre to about ₦1,000/litre, compounding the woes of the citizens who power their vehicles, and generating sets with petrol, no thanks to decades-long epileptic electricity supply. Last December, the billionaire industrialist commenced operations at the facility situated in Lagos with 350,000 barrels a day. The refinery, which was initially bogged by regulatory battles, hopes to achieve its full capacity of 650,000 barrels per day by the end of the year. The refinery has begun the supply of diesel and aviation fuel to marketers in the country and now petrol.
Admin | 2025-03-20 06:31:10