When any new controversy sets in threatening the integrity of the 650,000barrels per day Dangote refinery positioned off Lagos State, the key executives running the plant always try to soak into a picture of grace while putting out a reaction and that is what the company thought it did, giving out a weekend press release that challenged a conglomeration of oil marketers who are talking up their capacity to import types of fuel to Nigeria at a cheaper rate than what the plant currently offered.

That sort of claim could be detrimental to the Lekki Free Trade Zone (LFTZ) facility if consumers believe that they can get the premium quality filling up storage built inside the plant from those importing. Ever since the world’s largest single-train refinery was commissioned by the past President Muhammadu Buhari administration on Monday 22 May 2023, it has faced several struggles, especially connecting to crude oil acquisitions which the Nigerian National Petroleum Company (NNPC) Limited naturally ought to have solved since the mid-year commissioning.

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Getting crude oil to process premium motor spirit, diesel and the JetA1 fuel that airlines need isn’t the major problem nowadays, the Dangote refinery faces an information war which is drawing a suitable cutting retort from the Dangote Group Chief Branding and Communications Officer, Mr Anthony Chiejina.

The argument from the refinery since it commenced gradual processing of various crude oil derivatives in September, is that there is no need to import fuel with 650,000barrels of production capability in the country. Such a position has led to a push-back and what the President of the group Mr Aliko Dangote sees as scheming or sabotage.

Now, a claim that the Independent Petroleum Marketers Association of Nigeria (IPMAN) and Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) threaten to distort facts and here is comms officer Chiejina straightening everyone yesterday.

In the press statement published on Sunday 3 November 2024, he said that we had lately refrained from engaging in media fights, but we are constrained to respond to the recent misinformation being circulated by IPMAN, PETROAN, and other associations.

Both organisations have claimed that they can import PMS at lower prices than what is being sold by the Dangote Refinery and the executive repudiates this on behalf of his company.

He said that we benchmark our prices against international prices, and we believe our prices are competitive relative to the price of imports. If anyone claims they can land PMS at a price cheaper than what we are selling, then they are importing substandard products and conniving with international traders to dump low quality products into the country, without concern for the health of Nigerians or the longevity of their vehicles. Unfortunately, the regulator (NMDPRA) does not even have laboratory facilities which can be used to detect substandard products when imported into the country.

At the moment, the refinery sells PMS or petrol to domestic marketers at ₦960 per litre for sale into ships and at ₦990 for sale into trucks, although an IPMAN’s spokesperson who is its National Publicity Secretary Chinedu Ukadike reportedly told an online magazine that the rates being offered ought to go lower.

IPMAN considers the pricing system a bit rude because PMS is being produced in Nigeria finally. The country’s Organisation of Petroleum Exporting Countries (OPEC) Statute responsibility binds it to align with the cartel’s pricing integrity. With that, there will be unreasonable prices that the oil marketers see.

Emphasising this as a misnormal, Ukadike said the most important thing in a deregulated economy is competition. Competition should be allowed.

What IPMAN wants right now is a cheaper price than ₦960 and ₦990 per litre for Dangote Refinery; that is the bottom line. Dangote Petrol ought to be significantly cheaper to discourage imports. If you are selling Dangote Petrol at a price that makes people consider importing the product, there is an issue.

If at the end of the day, imported fuel is sold at ₦1,040 while Dangote sells at ₦990 per litre (for trucks) before reaching end users, it indicates a problem. Either the refiner or importers are not being truthful.

The animosity that the Dangote refinery and the marketers share wasn’t always there. One time, before a sequence of oddities including the NNPCL declaring sole PMS importer status and later reversing it, both the importers and the end consumer were looking to enjoy the benefit of the $20billion plant – they had anticipated significant price reduction different from what global inflation had caused but they haven’t seen that yet.

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In the IPMAN representative’s comment, there was a call asking the government to set up a presidential committee to address issues between the Nigerian National Petroleum Company Limited (NNPCL), the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), and Dangote, towards a favourable pricing system.

Before now, several task groups had already been set up to deal with problems as they emerged. After a Federal Executive Council (FEC) directive in late July asked the NNPCL to sell crude oil to local refiners in Naira instead of with dollar bills, an implementation committee ensured alignment with the 64th Independence Day anniversary launch date on 1 October 2024.

As one criticism follows another, there is a feeling that its job is not done. One more policy hack will be needed and it must directly address how much people get PMS to fill up engines both for their transport and energy use.

Issues on the front burner are the Dangote refinery’s accusation that an international trading company has recently hired a depot facility next to the plant, with the objective of using it to blend substandard products that will be dumped into the market to compete with Dangote Refinery’s higher quality production.

The refinery also says allowing the importation of sub-standard petrol is to export jobs and hopes someone is listening to its illustrations. We should point out that it is not unusual for countries to protect their domestic industries in order to provide jobs and grow the economy. For example, the US and Europe have had to impose high tariffs on EVs and microchips in order to protect their domestic industries.

Meiza Nigeria