Marketers consider fuel import as Dangote Refinery reportedly underdelivers

Nigerian petrol marketers alleged that the Dangote Refinery is not living up to its promise to produce 25 million litres of petrol per day.

Petrol marketers are resorting to petrol importation to augment the supply from the Dangote Refinery.

The marketers’ move is based on the argument that the volume of Premium Motor Spirit from the $20bn Lekki-based refinery is insufficient to meet local demands.

The Nigerian oil marketers’ resolution aligns with the Trade Union Congress’ sentiment on the volume of petrol the Dangote Refinery produces daily.

What’s the issue with Dangote Refinery?

Amid the allegation that the refinery is not living up to its promise to produce 25 million litres per day, the TUC called on the management of the facility to ramp up production.

It would be recalled that in September, the Nigerian Midstream and Downstream Petroleum Regulatory Authority announced that the Dangote Refinery would daily supply 25 million litres of petrol to the Nigerian market.

“The refinery is now poised to supply an initial 25 million litres of PMS into the domestic market this September. And will subsequently increase this amount to 30 million litres daily from October 2024,” the NMDPRA said.

In mid-September, after the refinery had commenced the release of petrol to the Nigerian National Petroleum Company Limited (NNPCL), the national oil company said the refinery struggled to deliver its 25 million litres per day promise.

Aliko Dangote’s refinery project has the capacity to produce 650,000 barrels per day. [Nairametrics]

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According to the NNPC, the facility could only deliver 16.8 million litres out of the 25 million litres of petrol it initially agreed with the refinery.

An oil marketer, who spoke to Punch said the Dangote Refinery is not producing up to 10 million litres of petrol as initially announced.

Oil marketers are set to look elsewhere

However, to make up for the shortfall, marketers are gearing up to commence petrol importation as Dangote Refinery allegedly fails to meet domestic demands.

According to Hamed Fashola, the National Vice President of the Independent Petroleum Marketers Association of Nigeria, the association has acquired two tank farms in Lagos and Calabar already.

He said, “We have acquired a tank farm in Calabar and another one in Lagos. We are positioning ourselves for the new era. We will not disclose the capacity of the tank farms now.

“We are free to start importation. With the new development, we are going to get our import licence soon, even as we are going to get a licence to buy from Dangote. So, it’s good to have two or three places to source your products from.”

He explained that with full deregulation of the downstream sector, everybody should be free to bring petrol into the market. He, however, added that if the government fails to allow that, there would be a monopoly, which according to him is not good for Nigerians.

“You must have an alternative in life. When you don’t have an alternative, everything stands still,” he concluded.
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