The Nigerian National Petroleum Company Limited (NNPC) has directed oil marketers to stop importing petrol, citing the Dangote Refinery’s capacity to meet the country’s fuel demand.
The directive was issued during a high-level meeting in Abuja, attended by NNPC Group CEO Mele Kyari, representatives of major oil marketing associations, and other stakeholders in the petroleum industry.
An attendee revealed that the NNPC made its position clear, stating that all petrol supply decisions would now hinge on the operational capacity of the Dangote Refinery.
“NNPC emphasised that no marketer would be allowed to import petrol without specific clearance tied to Dangote’s output,” the source disclosed.
This development has raised significant concerns among oil marketers, who question the refinery’s readiness to supply Nigeria’s extensive and fluctuating demand for petrol.
Marketers Raise Concerns
Many marketers fear that relying solely on Dangote Refinery could lead to supply chain disruptions if the refinery fails to deliver consistently.
“There’s skepticism about whether Dangote can fully handle the logistical and production challenges required to meet the nation’s demand,” a stakeholder shared.
Adding to the tension is a new payment structure proposed by Dangote Refinery. The refinery requires marketers to make advance payments before receiving supplies, a shift from the long-established practice of paying after delivery.
“Paying upfront puts financial strain on marketers, especially smaller players,” one stakeholder said. “For years, we’ve worked on a post-delivery payment system that aligns with our cash flow. This change is disruptive.”
The Dangote Refinery, which began operations earlier this year, has been selling products like diesel and jet fuel both locally and internationally.
Until recently, its gasoline production was exclusively supplied to the NNPC. However, as of November 4, the refinery started selling petrol to other local marketers.
Reports indicate that Dangote’s petrol has a higher quality, with a sulfur content of below 10 parts per million (ppm), compared to the 50 ppm standard for imported products.
Despite the improved quality, stakeholders are concerned about price differentials between Dangote’s premium fuel and cheaper imported alternatives.
“While the quality is better, there’s a noticeable cost difference, and marketers will have to weigh this against their operating expenses,” a source explained.
Documents reviewed by BusinessDay revealed that from October 1 to November 11, NNPC and its partners imported 1.5 million metric tonnes of petrol, 414,018 metric tonnes of diesel, and 13,500 metric tonnes of jet fuel.
This amounts to approximately ₦3 trillion, raising questions about the sustainability of continued importation in light of the Dangote Refinery’s capabilities.
A senior oil executive questioned the financial sources marketers use for fuel imports, asking, “Where are the marketers sourcing their dollars for imports, given the current foreign exchange constraints?”
Mele Kyari, NNPC’s Group CEO, previously announced at a Lagos conference that the national oil company had stopped importing petrol, instead sourcing products from local refineries.
“Today, NNPC does not import any product; we are taking only from domestic refineries,” Kyari stated on November 12.
However, the NNPC later clarified this statement, saying it was taken out of context.
“While NNPC prioritises sourcing products from domestic refineries, this depends on economic viability,” the company explained.
