Marketers Call for Government Support as Dangote Refinery Faces Challenges

In recent developments within the downstream oil sector, industry operators are urging the Nigerian government to intervene and ensure the provision of crude oil to the Dangote Petroleum Refinery. The refinery, owned by African business tycoon Aliko Dangote, has been facing challenges due to the higher cost of its products compared to imported refined petroleum products. Marketers prefer to buy cheaper imported products rather than patronizing the Dangote refinery. They also criticize international oil companies (IOCs) operating in Nigeria for selling crude oil to Dangote refinery above global market prices, labeling it as “anti-country practice.”

The Independent Petroleum Marketers Association of Nigeria (IPMAN) explains that the reason marketers are shunning the diesel and aviation fuel produced by the Dangote refinery is that the products are more expensive. The President of IPMAN, Abubakar Maigandi, states that the refusal of Aliko Dangote to collaborate with IPMAN is another factor affecting the $20 billion refinery.

Devakumar Edwin, the Vice President of Oil and Gas at Dangote Industries Limited, accuses international oil companies in Nigeria of planning to frustrate the survival of the new Dangote refinery. He reveals that while 25 licenses were issued for the construction of refineries in Nigeria, only the Dangote Group delivered on its promise. Edwin notes that more than 3.5 billion liters of Dangote diesel and aviation fuel have been exported to Europe in the past few months, accounting for 90% of its output.

However, Maigandi blames Dangote for the importation of diesel by operators, stating that his diesel is more expensive. He urges Dangote to reduce the price of his products to discourage importation by other marketers. Maigandi emphasizes that if Dangote’s products were cheaper, there would be no need for people to import so-called dirty fuel.

The Dangote refinery official also accuses the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) of granting licenses indiscriminately to marketers to import dirty refined products into the country. However, the NMDPRA has remained silent about this accusation.

The IPMAN president reveals that Dangote refused to sign a deal with independent petroleum marketers for the distribution of its products. He suggests that Dangote should allow independent marketers to buy fuel directly from him to improve the market and reduce prices.

An official from the Dangote Group attributes the high cost of diesel to the importation of crude oil from the United States. He claims that international oil companies are denying Dangote access to crude oil, forcing the refinery to import at higher costs.

Oil marketers criticize the IOCs for raising the cost of crude oil to the Dangote Petroleum Refinery above the global market price, labeling it as anti-country practices. They urge the government to mandate the IOCs to supply crude to the refinery.

In response to the challenges faced by the Dangote refinery, the Nigeria Upstream Petroleum Regulatory Commission promises to ensure that crude oil is supplied to the refinery. Efforts are being made to resolve the issues and support the growth of the refinery for the benefit of the Nigerian economy.