In a development that could have significant implications for the country’s fuel supply, the Independent Petroleum Marketers Association of Nigeria (IPMAN) has revealed that the upcoming Dangote Petroleum Refinery is unlikely to be a viable source of petrol for most oil marketers in Nigeria.
According to IPMAN’s Deputy National President, Zarma Mustapha, the refinery, which is set to commence petrol production in August 2024, will sell its fuel at international market rates. This price, he says, will be far higher than the domestic pump prices currently being offered by filling stations across the country.
“The current price of the product within the country is below the international price of a litre of PMS,” Mustapha explained. “So you cannot buy the product from the refinery at the international price and then sell it at the prevailing price at the retail outlets. If you do, you are going to lose a huge amount of money, which is a difference of between N400 and N500/litre.”
The development comes despite earlier statements from Aliko Dangote, the President of Dangote Industries Limited, that the $20 billion refinery had resolved its crude oil supply issues with the help of the Nigerian National Petroleum Company Limited (NNPC) and the Federal Government.
Mustapha suggested that for Dangote’s petrol to be made available at Nigeria’s filling stations, the NNPC would need to intervene by purchasing the product from the refinery and reselling it to dealers at discounted rates.
“NNPC may have to offtake the product, just like they are importing from other countries for upward supply to Nigerian marketers,” he said. “I think only the national oil company can offtake PMS from them and know how best they can continue to supply it to marketers to sell at the approved current price.”
The news also comes as the Major Energies Marketers Association of Nigeria (MEMAN) revealed that the landing cost of petrol was N1,117/litre as of July 16, 2024 – far above the current pump price of between N660/litre and N800/litre in the country.
