Dangote Petroleum Refinery Limited has emphasized its ongoing struggle to secure sufficient crude oil from domestic production and has called on the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) to enforce the domestic crude supply obligations as outlined in the Petroleum Industry Act (PIA).
The company made its position clear in a statement signed by its Group Chief, Branding and Communications Officer, Anthony Chiejina, addressing challenges in obtaining local crude for its operations.
In the statement, Dangote Refinery refuted media reports suggesting that it had accused the Nigerian National Petroleum Company Limited (NNPCL) of failing to supply crude oil. The company clarified that while it acknowledged receiving 60% of the 50 million barrels it lifted from NNPCL, its primary concern lies with NUPRC’s reluctance to enforce the domestic crude supply obligation, ensuring that the refinery receives its full crude requirement from both NNPC and International Oil Companies (IOCs).
The statement revealed that for September, the refinery required 15 cargoes of crude, of which NNPCL allocated only six. Despite appeals to NUPRC, the refinery was unable to secure the remaining cargoes. Attempts to source crude from IOCs operating in Nigeria were met with redirection to their international trading arms or responses that their cargoes were already committed elsewhere.
As a result, Dangote Refinery has often been forced to purchase Nigerian crude from international traders at an additional premium of $3-$4 per barrel, translating to an extra $3-$4 million per cargo. The company insists that this situation is unsustainable and continues to urge NUPRC to fully enforce the domestic crude supply obligation as mandated by the PIA.
This dispute has led to significant tension between Dangote Group and both government officials and international oil companies.
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Aliko Dangote, Group Chief Executive Officer, has reportedly been engaged in a series of confrontations with these stakeholders, accusing government officials of frustrating his business efforts and alleging that most of the refinery’s crude supplies are imported rather than locally sourced.
The controversy has sparked widespread debate, with various groups and individuals urging the Nigerian government to support the Dangote Refinery’s operations rather than obstructing its efforts. Many believe that encouraging the refinery’s success is crucial for the country’s economic growth and energy security.
