Politics
Fuel Scarcity Threatens as Dangote Criticizes NNPCL for Insufficient Petrol Supply
The Dangote Petroleum Refinery has raised concerns over insufficient crude oil supplies under Nigeria’s naira-for-crude initiative. Vice President Devakumar Edwin stated that while the Nigerian National Petroleum Company Limited (NNPCL) committed to supplying 385,000 barrels per day (bpd), actual deliveries have fallen significantly short, providing only “peanuts” in comparison to the refinery’s requirement of 650,000 bpd....CONTINUE READING>>>
Key Points:
- Naira-for-Crude Initiative: Launched in July to reduce foreign currency pressures, this program allows local refineries to buy crude in naira. Dangote Refinery is currently the sole beneficiary among the country’s eight operational refineries.
- Shortfalls in Supply: Despite initial agreements, only a fraction of the crude has been delivered, forcing Dangote Refinery to seek alternative sources, including importing U.S. WTI Midland crude.
- Operational Challenges: The $20 billion refinery, designed to process 425,000 bpd, is operating below capacity but aims to reach 85% output by year-end.
- Government Inaction: Regulatory bodies, including NNPCL and NUPRC, have not commented on the shortfall. Dangote has urged enforcement of regulations prioritizing local refineries for crude supply.
- NNPCL’s Global Focus: While struggling to meet domestic commitments, NNPCL is expanding international crude sales, introducing a new Utapate grade in global markets.
The crude supply gap threatens fuel production stability, raising concerns about Nigeria’s energy strategy and the naira-for-crude program’s efficacy.
