According to the PUNCH Newspaper, a major turning point in Nigeria’s energy industry was reached on Tuesday when Nigerian National Petroleum Company (NNPC) Limited started distributing Premium Motor Spirit (PMS) from Dangote’s sizable refinery in Lekki, Lagos. This invention is thought to represent a turning point in Africa’s fuel supply, offering a more dependable and efficient gasoline source.CONTINUE FULL READING>>>>>
The Dangote refinery, a $20 billion investment, is poised to transform Nigeria’s fuel landscape. According to Aliko Dangote, President of the Dangote Group, the refinery has the capacity to not only meet Nigeria’s petrol needs but also supply the entire sub-Saharan region. Speaking during an inspection of the 650,000 barrels per day facility, Dangote emphasized the refinery’s potential to reshape the fuel market in the region.
“Our capacity will more than satisfy Nigeria’s demand and will also cater to the needs of sub-Saharan Africa,” Dangote stated. He further highlighted the refinery’s role in curbing illegal fuel trading, commonly referred to as “round-tripping,” which has plagued Nigeria’s fuel sector. With the new refinery operational, Dangote assured that Nigeria’s true fuel consumption could be accurately tracked, and the quality of the petrol produced would meet global standards.
“Our PMS can be available at filling stations within the next 48 hours, depending on NNPC’s distribution logistics,” Dangote added, assuring Nigerians of high-quality fuel that would reduce engine-related issues commonly associated with substandard petrol.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has confirmed that the Dangote refinery will initially supply 25 million liters of PMS daily to the Nigerian market starting this September. This is expected to increase to 30 million liters daily by October 2024. The agreement for local crude supply to the refinery in local currency was finalized between NNPC Limited and Dangote Refinery, ensuring a steady flow of crude for refining.
Business magnate Femi Otedola commented on the impact of the Dangote refinery, predicting a significant decline in the relevance of local fuel depots, which have traditionally depended on fuel imports. “Depot owners should take heed—it’s time to dismantle those depots and sell them as scraps while the market is still high,” Otedola remarked, emphasizing the need for adaptation in the changing energy landscape.
Ayodele Oni, a senior partner at Bloomfield Law, expressed cautious optimism about the potential impact of the refinery on PMS prices. He noted that the reduction in logistics costs, as well as the elimination of large-scale imports, could lead to lower fuel prices, though the international crude oil market would still play a significant role in pricing.
The Dangote refinery is expected to have far-reaching effects beyond Nigeria. It could disrupt the global fuel trade, particularly impacting European refineries that have long enjoyed a lucrative market in Nigeria. Analysts suggest that as much as 300,000 to 400,000 barrels per day of European refining capacity could be at risk of closure due to the increased global gasoline production driven by facilities like Dangote’s.
Meanwhile, NNPC Limited has raised petrol prices to N897 per liter at various outlets in Lagos, amid ongoing challenges in maintaining a steady fuel supply. The price hike comes as NNPC struggles with financial pressures related to PMS supply costs. Recent fuel scarcity in major Nigerian cities has exacerbated the situation, leading to price increases and long queues at filling stations.
In various parts of Lagos, including Ikeja and Ikorodu, petrol prices have surged to as high as N1,000 per liter. This trend has also been observed in Ogun State and the nation’s capital, Abuja, as motorists and commuters express frustration over the escalating fuel prices and the ongoing uncertainty in the market.CONTINUE FULL READING>>>>>
