Dangote to sell petrol N766/litre to NNPCL as marketers target direct deal

 

By Editor

 

Marketers have demanded direct access to Premium Motor Spirit (PMS), also known as petrol from the Dangote Refinery, criticising the firm grip of NNPC Limited (NNPCL) on the market.

This is as sources said Dangote Refinery would sell its petrol at N766 to NNPCL.

The National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Mr. Chinedu Ukadike said the market should be open for all in line with the willing-buyer and willing-seller commitment earlier made by the corporation.

On Saturday, NNPCL had said it was not the sole off-taker of products from Dangote Refinery, adding that the refinery was free to sell its petrol to any marketer.

A week after the statement, the Federal Government announced that the company would be the sole buyer of petrol from the refinery.

At a press briefing in Abuja on Friday, the Minister of Finance and the Coordinating Minister of the Economy, Mr. Wale Edun, noted that interested marketers would have to buy the product from the national oil firm through its trading company.

The minister, represented by the Executive Chairman of the Federal Inland Revenue Service (FIRS), Dr. Zacceus Adedeji, also announced that Dangote Refinery would commence the distribution of petrol to marketers on Sunday with an initial 25 million litres per day.

He said: “I am glad to announce that all agreements have been put in place, and the loading of the first batch of PMS, as already announced by NNPCL, will commence on Sunday, 15 September 2024. And from 1 October, NNPCL will commence the supply of crude oil to the Dangote refinery to be paid in naira.

“In return, Dangote refinery will supply PMS and diesel of equivalent value to the domestic market to be paid in Naira. But for now, PMS will only be sold to NNPCL. NNPCL will then sell to various marketers”.

Reacting, Ukadike said the market should be liberalised.

“It should be open for all in line with the willing-buyer and willing-seller comments made by the NNPCL. We are also looking at how to build our logistics and come up with our price”, he stated.

Also, the National President of the Petroleum Products Retail Outlets Association of Nigeria, Mr. Billy Gillis-Harry, raised concerns over the risks of creating a new domestic monopoly in the oil and gas sector.

Gillis-Harry said: “Right now, even on Saturday, that business (petrol) is going to start rolling out tomorrow (Sunday), we don’t know what the price might be. Nobody has informed us about anything; we are not aware of what the government is doing.

“We don’t know any of the pricing templates yet or the matrix that will bring about the pricing template. We have been asking Dangote or anybody that is in charge of this transaction to be transparent, but somehow, we have not got any of that information.

“We are about to leave NNPCL monopoly from importation and now we are also going to have that in a domestic environment that portends danger for the industry”.

On Saturday, NNPCL said it had mobilised 300 trucks to lift PMS from Dangote Refinery today (Sunday).

The spokesperson for the corporation, Mr. Olufemi Soneye disclosed that the mobilisation of trucks to the refinery was based on the agreement reached by both parties as regards the lifting of petrol from the $20 billion Lekki-based facility.

In a post on his official X handle that showed some trucks lining up at the refinery, Soneye said: “NNPC Ltd trucks are arriving at the Dangote refinery in preparation for the scheduled petrol loading on Sunday, 15 September 2024. By the end of today (Saturday), at least 300 trucks will be stationed at the refinery’s fuel loading gantry”.

But Soneye said, “Yes, trucks have indeed been mobilised there. Nobody has picked up anything yet. NNPCL was given a 15 September date; it is lining up trucks there so that if they open the gates for it to move in and load, then it will load”.

Oil marketers confirmed that the NNPCL had started moving trucks to the plant to load products, adding that the national oil company would also load PMS using its vessels.

They also noted that the price of Dangote petrol had not been made public yet, stating that independent marketers would only buy the commodity from the NNPCL for now.

IPMAN’s National Operations Controller, Mr. Mustapha Zarma said: “Independent marketers have not been given any offer by Dangote to ascertain the actual off-take price.

“So, for now independent marketers will be taking the product from NNPC, but hopefully in the next few weeks, we may start getting it directly from Dangote”.

Zarma noted that the NNPCL would offtake the product from the Dangote refinery using tankers and ships that would move the PMS to coastal depots in Warri and Port Harcourt.

Multiple sources from the Federal Ministry of Petroleum Resources, NNPCL, and major energy marketers confirmed that the deal to supply crude to Dangote Refinery in Naira was a key factor that led to the PMS price of N766 per litre to NNPCL.

“What we are going to see based on the deal between NNPCL and Dangote is similar to the DSDP (Direct Sale of crude oil and Direct Purchase of petroleum products) transactions that used to exist between NNPCL and foreign refineries in the past.

“And this has really impacted positively on the price of petrol that Dangote is selling to NNPCL, because the cost is around N766/litre. But I can’t tell how much NNPCL is going to sell to marketers now”, a major marketer, who spoke to Sunday PUNCH in confidence due to lack of authorisation to comment on the matter, stated.

Another senior aide to President Bola Tinubu, who spoke on condition of anonymity, confirmed that the petrol would be sold at N766 per litre.

Reacting to the Dangote fuel price, a senior IPMAN official said if marketers could get the product at N766, they would need to add the cost of transportation, levies, and other margins.

He said: “Give and take, we can sell at N790 in Lagos. In the far north, it may be N820 per litre because of the distance”.

Gillis-Harry said his group was not aware of the price of fuel from the Dangote refinery.

“Well, it will be acceptable because now we are paying NNPCL N870 for a litre, so if we see it at N766, it is cheaper and we will prefer to buy that.

“I cannot determine how much we will sell to Nigerians; we will work out the retail price. It is not one individual or one organisation’s prerogative to put a price, we will work it out and we will argue out our point.

“We are ready to support Dangote, but they are not talking to us. We are the people they need; I have over 6,000 retail outlets under my management, but Dangote is not talking to us”, he added.