As the Nigerian National Petroleum Company, NNPC Limited, moves to end petrol scarcity in Lagos and its environs, Dangote Refinery and oil marketers have intensified efforts at taking final decisions on pricing and delivery of petrol to filling stations nationwide.
Dangote Refinery, which can refine 650,000 barrels per day,
bpd of crude oil, intends to commence production and distribution of the
product, the bulk of which is currently imported from the global market, in May
2024.
Checks by Vanguard, weekend, indicated that the parties have
been meeting and exchanging notes on the pricing, distribution and margins to
stakeholders in the value chain, including transporters and insurers.
Recall that depot owners buy the product from NNPC Limited
at N556 per litre and sell to independents at N640 per litre.
It was, however learnt that independent markers have
proposed N550 per litre to management of Dangote Refinery who is currenty in a
discussion with them.
We have proposed N550 per litre — Marketers
The President of Independent Petroleum Marketers Association
of Nigeria, IPMAN, Alhaji Abubakar Migandi Garima, who confirmed the
development yesterday, said: “We have been discussing with Dangote Refinery.
The discussion, centering on pricing, margins and other issues, is still
ongoing.
“We have proposed that the lifting price should be N550 per
litre in Lagos. The price of the product will differ from one part of Nigeria
to another because of distance and cost of delivering petrol to different
locations.
“We are currently waiting on Dangote Refinery to conclude
and communicate the price per litre, so we can plan to lift the product when it
comes on stream.
‘’We expect that the price of the locally refined petrol
would be cheaper than imported petrol, due mainly to local availability of the
bulk of its crude oil and removal of transportation cost.”
Let’s enjoy benefit of domestic refining — Experts,
consumers
Similarly, Executive Director, Emmanuel Egbogah Foundation
for Petroleum and Energy Industry Economics and Policy Advocacy, Professor Wumi
Iledare, said the coming on stream of Dangote Refinery presented an opportunity
for Nigerians to enjoy cheaper prices of petrol now or later.
He said: “The price of petroleum is majorly correlated with
the acquisition cost of crude oil. The cost of running the refinery and
opportunity cost of capital contribute marginally. Distribution and retailing
costs are important but the crude cost matter the most.
‘’Thus, low price of petrol in Nigeria when Dangote Refinery
operates at full capacity, is a possibility indeed, ceteris paribus.”
A motorist, who pleaded anonymity, said: “Most people have
stopped driving every day. That is why we do not experience much traffic in the
cities, including Lagos anymore. I am pleased that the Dangote Refinery will
soon supply petrol. We hope and pray that it will be cheaper than the imported
product.”
FG should float $1bn fund to complete new refineries —
Refinery owners
However, President of Crude Oil Refinery-owners Association
of Nigeria, CORAN, Mr. Momoh Oyarekhua, said: “ The coming on stream of Dangote
Refinery is a very good development, especially as it would reduce huge
dependence on imported petrol, conserve foreign exchange and create additional
jobs.
“The government needs to support the construction of other
indigenous refinery projects, currently at different stages nationwide. We have
proposed the creation of $1 billion fund to support local investors.
‘’If this is done, lack of funds, which has always been a
major challenge, would to some extent be addressed.
“The federal government and other stakeholders, including
the Nigerian Midstream, Downstream Petroleum Regulatory Authority, NMDPRA,
should engage with indigenous investors to explore the best ways and means of
bringing this into reality in the best interest of oil and gas industry and the
nation’s economy.”
We expect sector wide impact – CPPE
Also, the Chief Executive Officer, Centre for the Promotion
of Private Enterprise, CPPE, Dr. Muda Yusuf, said: “If we are able to take
advantage of Dangote refinery to reduce our consuming products, it will go a
long way in easing the country’s foreign exchange crisis. However, it would
also make positive impact across all sectors.”
It’s premature for our reaction—NLC
Asked to react to the development yesterday, an official of
the Nigeria Labour Congress, NLC, who chose to remain anonymous, said it was
premature for comments, saying “how can we react to speculations? When we see
what they have done, then, we can say something. For now, we think it is
premature.”
NNPC Ltd moves to end shortage
On the current scarcity of fuel in some parts of Lagos and
its environs, the Chief Corporate Communications Officer, NNPC Limited, Olufemi
Soneye, stated: “The NNPC Limited wishes to inform the general public that the
tightness in Premium Motor Spirit, PMS, supply witnessed in some filling
stations in Lagos was a result of an issue in one of the depots in the area.
“The NNPC Retail Limited, our retail arm, has since resolved
the issue and effective tomorrow (today), normalcy will be restored within the
affected area.
“NNPC Limited calls on motorists in Lagos to avoid panic
buying of PMS as all hands are on deck to sustain sufficiency in the supply of
petroleum products in the area.”