Dangote Petroleum Refinery has revealed that it will export its Premium Motor Spirit (PMS), commonly known as petrol, if the Nigerian National Petroleum Company (NNPC) Limited and other domestic petroleum marketers choose not to purchase it.
Devakumar Edwin, Vice President of Oil and Gas at Dangote Industries Limited, made this statement on Monday during an appearance on the Brekete Family live show.
Edwin confirmed that the refinery has begun producing petrol, as earlier reported. He noted that local oil traders have been importing diesel and aviation fuel, which has hindered the domestic sales of Dangote’s fuel.
He stated, “We have already been exporting aviation fuel, producing kerosene, and diesel, and just yesterday, we began the production of PMS. This marks the final stage, with petrochemicals being the only product yet to be produced.”
Edwin shared that the good news for the country is that Dangote’s refinery has started producing PMS as of Sunday.
Nigeria’s expenditure on petrol soared to N2.6 trillion in the first quarter of 2024, representing a 46 percent increase from the fourth quarter of 2023.
This data comes from the latest foreign trade report by the National Bureau of Statistics (NBS) for the first quarter of the year.
The cost of motor spirit imports was N1.8 trillion in the fourth quarter of 2023 and a combined N7.5 trillion for the entirety of 2023.
When asked if the petrol would be sold domestically, Edwin explained that local traders have been blocking the distribution of their products within the country. As a result, Dangote has been exporting its petroleum products, including PMS.
He said that if traders or NNPC do not buy the petrol, they will continue exporting it as they do with aviation fuel and diesel.
Edwin expressed his surprise at the unforeseen challenges the company encountered when the refinery was ready to begin operations.
He reflected on the initial goal, which was to add value to Nigeria’s raw materials by refining crude oil locally, rather than exporting it, and supplying finished products within the country.
However, he regretted that Nigeria continues to export crude while importing refined petroleum products, even after three decades.
Edwin noted that the original plan has been disrupted due to difficulties in securing crude oil. Currently, the refinery is importing crude from the US, Brazil, and other countries, as local supply is inadequate.
He reiterated that the refinery is not receiving sufficient crude allocations, leading them to import crude from abroad, although some crude is still sourced locally.
Edwin highlighted that domestic crude supply obligations, as stated in the Petroleum Industry Act, require that no crude should be exported until all local refinery needs are met. However, he revealed that they are still struggling to obtain crude oil.
Due to the insufficient local crude supply, Edwin mentioned that the refinery has begun constructing four crude tanks, each with a capacity of 120 million litres, to store imported crude. This is necessary to ensure sufficient stock due to shipping times.
Join BusinessDay whatsapp Channel, to stay up to date
Open In Whatsapp
