The Dangote Petroleum Refinery has begun supplying Premium Motor Spirit (PMS), commonly known as petrol, directly to oil marketers without involving the Nigerian National Petroleum Company Limited (NNPCL).
It was learned that several marketers are now sourcing petrol directly from the refinery, while others continue importing the product.
In fact, hundreds of millions of liters of imported PMS are expected to arrive in Nigeria within the next two weeks.
Earlier, from the report, that four vessels carrying imported PMS had docked at seaports along Nigeria’s borders between October 18 and 20, unloading approximately 123.4 million liters of petrol at two locations to boost the national fuel supply.
This confirmed a previous report that oil dealers plan to import petrol to supplement supply from the $20 billion Dangote Refinery.
Dangote Refinery
While some major oil marketers continue importing PMS, others have started collecting the product directly from the Dangote Refinery, located in Lekki.
A senior official from the refinery confirmed that marketers are now engaging in direct business with the refinery on a “willing buyer, willing seller” basis.
“Marketers are lifting PMS directly from the refinery, bypassing third parties,” the official, who requested anonymity due to lack of authorization to speak publicly, stated.
Though the official didn’t disclose the price at which petrol is being sold, they assured that the pricing is favorable enough for marketers to opt for direct purchases.
The official also noted that operations are improving, especially since the Federal Government started supplying crude oil to the facility.
Another source showed evidence of trucks from various marketers loading fuel directly from the refinery, confirming that direct sales had commenced.
To meet the high domestic and regional demand for petrol, the refinery has focused on producing 53 percent of PMS from its crude oil supply.
This allocation could be adjusted in the future refinery depending on the demand for other refined products, the official added.
When asked whether oil marketers had begun purchasing petrol directly from the Dangote Refinery without involving the Nigerian National Petroleum Company (NNPC), a prominent marketer confirmed that they had.
“Yes, everyone is in the process. This was expected to happen soon and is a standard business transaction,” the marketer said.
This development contradicts earlier claims suggesting that the refinery could not sell petrol to marketers unless its deal with NNPC was terminated.
Initially, the company had announced that NNPC would be the sole off-taker of its petrol starting September 15. According to a refinery source, this decision was influenced by the Federal Government.
However, things changed when the Technical Subcommittee on Domestic Sale of Crude Oil in Local Currency announced on October 11 that marketers could now lift petrol directly from the refinery.
“Going forward, petroleum product marketers can purchase PMS directly from local refineries without NNPC as an intermediary.
Marketers are encouraged to negotiate direct purchases with refineries on mutually agreed commercial terms, which will foster competition and enhance market efficiency,” stated Wale Edun, the Minister of Finance, who heads the committee.
Following this announcement, industry operators said the market had been fully deregulated, and many planned to approach the Dangote Refinery to apply for PMS lifting.
The PUNCH recalls that the Vice President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Hammed Fashola, recently led other officials to meet with the Vice President of Dangote Industries, Devakumar Edwin, in Lagos.
While Fashola didn’t provide many details about the meeting, he expressed gratitude to Edwin for facilitating discussions.
“Edwin received us warmly and promised to ease the process for IPMAN to do business with Dangote,” Fashola said.
“We had a productive discussion, and IPMAN has agreed to work with Dangote. We hope to begin lifting products from the facility soon.”
Despite this, IPMAN indicated they couldn’t start off-taking products immediately until the refinery ended its contract with NNPC.
However, officials from the refinery confirmed that PMS sales to some marketers had already begun.
When Dangote Refinery first started selling PMS on September 15, NNPC claimed it purchased the product at N898 per liter, a statement the refinery dismissed as misleading.
The refinery clarified that the Naira-for-Crude Committee would set the official price of its PMS, but as of October 22, the committee had not yet made an official announcement.
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