Only NNPCL can buy Dangote petrol – IPMAN

Oil marketers in Nigeria have declared that they will not buy Premium Motor Spirit (PMS), also known as petrol, from the Dangote Petroleum Refinery at the prevalent pump prices.

This decision comes after the President of Dangote Industries Limited, Alhaji Aliko Dangote, announced that the $20bn refinery was set to roll out its petrol in August 2024.

The refinery had resolved its crude oil supply issues through the help of NNPC and the Federal Government, enabling it to commence production.

However, oil marketers told our correspondent that no dealer in Nigeria would be able to buy the petrol from the Dangote refinery due to the high price.

The product will be priced at the international market rate, far higher than the domestic cost at the pumps.

When contacted, the Deputy National President of the Independent Petroleum Marketers Association of Nigeria, Zarma Mustapha, gave a negative reply regarding official communication on pricing.

Mustapha stressed that PMS from the plant would be sold at the international market rate, adding that no marketer would want to pay such price currently.

He explained that buying the product at the international price and selling it at the prevailing price at retail outlets would result in huge losses.

The current price of PMS in Nigeria is below the international price, making it impossible for marketers to buy from Dangote and sell at the approved current price.

Mustapha suggested that the Nigerian National Petroleum Company Limited (NNPC) may need to intervene by purchasing the product and reselling it to dealers at discounted rates.

This is the only way Dangote petrol can be sold across Nigeria’s filling stations, as marketers cannot afford to buy the product at the international price and sell it at a loss.

The landing cost of petrol is currently N1,117/litre, far above the pump price of N660/litre to N800/litre, depending on the area of purchase.

Major marketers also confirmed that they cannot buy petrol from the Dangote refinery due to the high landing cost, which is the realistic cost of the product.

NNPC, currently the sole importer of petrol into Nigeria, has yet to respond to enquiries on the matter, leaving the future of Dangote petrol sales in Nigeria uncertain.

The situation highlights the challenges facing the Nigerian oil industry, with marketers struggling to access foreign exchange and the government grappling with how to manage fuel prices.