The Nigerian National Petroleum Company Limited (NNPC) has directed oil marketers to halt petrol imports, stating that the Dangote Refinery has the capacity to meet Nigeria’s fuel demand. This development was reported by BusinessDay following a high-level meeting in Abuja involving NNPC Group CEO Mele Kyari, major oil marketers, and regulatory authorities.
According to the report, NNPC emphasized that going forward, all petrol supplies must be coordinated with the Dangote Refinery. An official present at the meeting noted, “NNPC made it clear that no marketer would be permitted to import petrol without clearance tied to Dangote’s capacity.”
The Dangote Refinery, which began operations in January, has already supplied diesel, jet fuel, and other refined products to both local and global markets. However, stakeholders expressed concerns about whether the refinery’s production and distribution systems are ready to meet the country’s fluctuating fuel demands.
One of the contentious issues is Dangote Refinery’s advance payment policy for marketers, which deviates from the traditional post-delivery payment system. A marketer highlighted to BusinessDay: “Upfront payment increases financial pressure on smaller players who are used to paying after product delivery. It’s a significant shift for the industry.”
The refinery’s premium petrol, which boasts a sulfur content of below 10 ppm, offers better quality than the previously standard 50 ppm in imported petrol. However, this has led to pricing challenges, as Dangote’s products are reportedly more expensive than imported alternatives.
BusinessDay also reported that between October 1 and November 11, 2024, NNPC and its partners imported over 1.5 million metric tonnes of petrol worth approximately $1.8 billion. This raised questions about the source of foreign exchange used by marketers for these imports, further complicating the transition to relying solely on local refineries.
Despite these concerns, NNPC has reiterated its commitment to prioritizing products from local refineries, including Dangote. While addressing a conference in Lagos, NNPC Group CEO Mele Kyari stated, “Today, NNPC does not import any product; we are taking only from domestic refineries.”
However, the company later clarified this statement in a press release, stating that while local sourcing is prioritized, fuel imports will continue if necessary to ensure cost-effectiveness and market stability.
This move is part of broader efforts to reduce Nigeria’s dependence on imported petroleum products, strengthen local refining capacity, and stabilize the downstream sector. The Dangote Refinery, with its vast capacity and improved fuel quality, is at the heart of this strategy.
