Table of Contents
Key Points
- Dangote Refinery begins direct sales of Premium Motor Spirit to select marketers, bypassing the Nigerian National Petroleum Company.
- This move aligns with Nigeria's policy changes, enabling marketers to source fuel directly from local refineries, reducing import reliance.
- Aliko Dangote's refinery operations position him as the world’s 65th richest person, enhancing his economic influence and Nigeria's fuel market stability.
The Dangote Oil Refinery, owned by Africa's richest man Aliko Dangote, has commenced direct sales of Premium Motor Spirit (PMS), commonly known as petrol, to selected oil marketers, circumventing the Nigerian National Petroleum Company Limited (NNPC).
The move reflects changes in Nigeria’s fuel distribution system and aligns with recent government policies allowing marketers to source petrol from local refineries. It aims to reduce reliance on costly imports, despite Nigeria being Africa’s top oil producer.
Oil marketers to source fuel from Dangote Refinery as imports continue
Multiple oil marketers are set to source Premium Motor Spirit (PMS) directly from Dangote Refinery, while others continue importing fuel. Nigeria expects hundreds of millions of liters of PMS to arrive within two weeks.
Between Oct. 18 and 20, four vessels delivered about 123.4 million liters of imported PMS to ports across the country, boosting nationwide supply. A senior refinery official said marketers can now engage with the refinery on a willing-buyer, willing-seller basis. “Marketers are visiting the refinery to lift PMS directly,” the official said anonymously.
To stabilize pricing and supply amid ongoing market fluctuations, the refinery plans to finalize pricing and lifting agreements with marketers. While the official did not disclose the current lifting price, they emphasized that oil dealers would only participate if the pricing is favorable.
A boost to Nigeria's economy and Aliko Dangote's wealth
Located near Lagos, the $20-billion facility is now the world's largest single-train oil processing plant, poised to end Nigeria's costly fuel import dependency. This development follows recent government policies allowing direct purchases from local refineries.
As major oil marketers commence direct liftings from the Lekki-based plant, the dual approach of local refinery supply and continued imports highlights the evolving dynamics of Nigeria's fuel market. This strategy aims to ensure a robust and reliable fuel supply in a nation plagued by chronic shortages.
With a net worth of $27.8 billion, as reported by the Bloomberg Billionaires Index, Aliko Dangote has recently ascended to become the world’s 65th richest person, further solidifying his status as the richest Black individual globally, surpassing South Africa's Johann Rupert and American tech billionaire David Steward.
The operational success of the Dangote Refinery not only promises to redefine the local petroleum landscape but also suggests a potential decline in Nigeria’s fuel import expenditures, paving the way for enhanced economic stability and growth in the region.
