Dangote Refinery: “Marketers Refuse To Buy Diesel, Petrol From Us Because Our Products Are Cheap”

Petroleum marketers in the country have refused to lift product from Dangote Refinery because its own price is cheaper than what is imported.

This is the complaint made to President Bola Ahmed Tinubu by the marketers in a letter they wrote to him on why they have refused to buy from the refinery.

Devakumar Edwin,  Vice President, Dangote Industries Limited, who spoke in  a Twitter Space session hosted by Nairametrics, said the marketers complained to the president, in a letter, that the cheap price from Dangote is bad for their businesses.

For instance, the marketers have complained that the drop in price of Dangote Refinery’s diesel to N900 per litre, is negatively impacting their businesses..

“Petroleum product marketers in Nigeria have written to President Bola Tinubu to complain that the refinery local prices which have dropped from N1,200 to N1,000 and now N900 per litre are impacting their businesses negatively,” Edwin said.

He said the refinery has managed  to sell about 29 tankers of diesel per day due to low patronage from local petroleum product importers.

The 650,000 barrel refinery, according to checks, has the capacity to load 2,900 trucks a day at its truck-loading gantries.

The revelation marked the latest face-off by the Refinery owned by Africa’s Richest Man, Aliko Dangote and some entrecnhed interests in the country after it started operation last year, energy analysts familiar with the issue said.

Recall that Dangote had last year accused the Nigerian National Petroluem Company Limiterd, NNPCL, of refusing to sell crude oil to the refinery.

Amidst the tug of war between the refinery and some entrenched interests in the country, Farouk Ahmed, the chief executive  of the Nigerian Midstream and Downstream Petroleum Authority, NMDPA had claimed that diesel from the Petrochemical refinery is below global standard.

Also recently, the NNPCL and Dangote Refinery had squarred up over the retail price of petrol, the latest product from the refinery after it started producing diesel and jet fuel last year.

The government-controlled oil company had said the refinery has the prerogative to set the price for the product, and sell directly to marketers, contrary to claim by Dangote that only the NNPLC can lift the product from the refinery and sell to marketers.

The confrontation, Edwin stated, is affecting smooth operations in the refinery, adding that there’s clandestine plan by some persons to frustrate products from the refinery from getting to the market.

If the blockage contnues, he said, the Refinery may have to look for patronage elsewhere.

Edwin said, “Well, I explained how there has been a kind of a blockade from lifting our products within the country. The traders have been trying to block (it), and so now we have been exporting our petroleum products. PMS, we are ready to pump in as much as possible to the country.

“But if the traders or NNPC are not buying the product, obviously, we will end up exporting the PMS as we are doing with the aviation jet and diesel,” he declared.

Edwin expressed surprise that the company started facing different challenges it never expected when the refinery was set to commence operations.

He recalled that the philosophy initially was to add value to the raw materials available in the country, regretting that Nigeria is still exporting crude and importing refined petroleum products after over three decades.

“The philosophy is to take the crude, and instead of exporting the crude, refine it, add value; export the finished products, and supply the finished products locally. But unfortunately for us, we started facing challenges with the crude supply.

“What is happening today? We are struggling to get the crude. We are now importing the crude from the US, we are importing from Brazil, and from other parts of the world. So, the whole philosophy has gone upside down. After all these decades, we are exporting crude, importing products,” he added.

“The same thing is continuing. We are not getting enough crude allocation, and the crude is still being exported. We are forced to import crude from outside. Yes, we are getting some crude locally, but it’s not adequate,” he stated.