So, which magic will squeeze out the 450k barrels? Dangote had better looked elsewhere and not bank on this promise.” You actually want to read what energy journalists, analysts, and researchers said during reaction on Platforms Africa forum
President Bola Ahmed Tinubu, has ordered the Nigerian National Petroleum Company Limited (NNPCL) to sell crude to Dangote Refinery in Naira, an order that was immediately greeted by reactions.
The Special Adviser to the President on Information and Publicity, Bayo Onanuga, revealed this in a post via his official X handle on Monday.
The Order
According to him: “To ensure the stability of the pump price of refined fuel and the Dollar-Naira exchange rate, the Federal Executive Council today adopted a proposal by President Tinubu to sell crude to Dangote Refinery and other upcoming refineries in Naira.
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“Dangote Refinery at the moment requires 15 cargoes of crude, at a cost of $13.5 billion yearly. NNPC has committed to supply four.
“But the FEC has approved that the 450,000 barrels meant for domestic consumption be offered in Naira to Nigerian refineries, using the Dangote refinery as pilot. The exchange rate will be fixed for the duration of this transaction.
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“Afreximbank and other settlement banks in Nigeria will facilitate the trade between Dangote and NNPC Limited. The game changing intervention will eliminate the need for international letters of credit. It will also save the country of billions of dollars used in importing refined fuel.”
Reactions
Reacting to the news on Platforms Africa forum, an energy journalist, Adewale Sanyaolu, said that Dangote “had better looked elsewhere and not bank on this empty promise.”
He wrote; “Where will the 450,000 barrels per day allocation to Dangote and other modular refineries come from? According to NUPRC, oil production as at July 23 was 1.16m barrels.
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“Of this figure, we have forward sales obligation to multilateral agencies to contend with. So which magic will squeeze out the 450k barrels? Dangote had better looked elsewhere and not bank on this empty promise.”
Corroborating Sanyaolu’s position during the discussion on Platforms Africa forum, veteran energy editor, Yakubu Lawal, wrote; “More also that the 1.16m barrels per day does not belong to NNPCL alone. IOCs crude equity is inclusive.”
A public affairs analyst, Sijibomi Benet-Adeniyi, however took a different position, maintaining that it requires the political will on the part of the president for the order to be executed.
He said; “This is where the political will comes in. We will now know if BAT is like PMB or GEJ. Was confirmed that production reached 1.7m daily in July (Channels & TVC news). 450m is about 25% of that.
“The international oil companies also have the mandate to supply about a quarter of their production to local refineries under the POI. Like I said, we will see if BAT’s order is also an empty threat like his predecessors.”
In a reaction, Sanyaolu wrote; “You cannot give what you don’t have. The production figure you gave is not a constant one. Production figure in Nigeria’s case is a galloping one. And like Alhaji Yakubu Lawal pointed out, those figures they reel out on a monthly basis are not entirely for Nigeria.
Remember, a couple are under JV arrangements which we are owing.
“At the moment Cash call arrears is in the region of billions of $. To the Domestic Crude Oil Supply Obligation as captured in the PIA, that is also on paper and not realistic or enforceable based on current market realities. NUPRC has held several meetings in the past with the IOCs on the need to adhere to Domestic Crude Oil Supply Obligation. What has been the result.
My brother, the issues are deeper than you think.”
Meanwhile, Dr. Omotuyi Mebawondu said that the order by the President “is a long walk to succour!”
He continued; “Sales, transportation, refining, distribution and pump sales will take more than one month. So why the NNPCL vs Dangote’s bout in the first instance?”
To energy analyst, Dr. Dauda Garuba, key issues ought to have been clarified before the president issued the order.
“There are bits of this issue that have not been clarified. The first is has the Dangote Refinery now registered? Has the claim about the poor quality of its products now also settled? What are we not going to hear/see in Nigeria?” He retorted.
A researcher and lecturer, Dr. Wasiu Tejuoso, in his reaction on the Platforms Africa forum, said; “To your first two questions, all of us understand the complexity of the politics behind such unwarranted allegations. No licence and such magnitude of refinery would commence? Is licencing not the first criteria for such commencement? Even the test done, is it not their so called imported fuel that was discovered had even lower quality?”
Answering the poser that Dr. Tejuoso posed during his intervention, Dr. Garuba said; “We are on the same side. The same laboratories that found Dangote refinery’s products substandard have often found the bad fuels imported into Nigeria good for consumption. For me, there’s much to the Dangote Refinery’s fight that we do not know.”
Described as the Africa intellectual power house, Platforms Africa forum is a forum hoisted on WhatsApp where members, cherry-picked from across the continent, discuss sundry issues and proffer solutions to key problems facing the continent.
It has as members, distinguished professors and researchers of communications; top publishers, broadcasters and journalists; distinguished medical doctors; lawyers; engineers; soft skill experts, finance solution experts, and other professionals who are opinion leaders, and policy moulders across the continent.
Platforms Africa
