NNPCL Shuns Dangote Refinery, Swaps Crude Oil for Loan with Others
- A source has explained why the Dangote Refinery could not start operation last month as earlier announced
- The source said the Nigerian National Petroleum Company Limited (NNPCL) was busy exchanging crude oil for loans and could not attend to the needs of the refinery.
- Dangote Group, however, noted that the NNPCL would supply its refinery from November
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A source in the Nigerian National Petroleum Company Limited (NNPCL) has stated that the company signed crude oil contracts with a number of entities.
As contained in a Punch report, the development prevented the company from initially meeting Dangote's demand.
The Executive Director, Dangote Group, Devakumar Edwin, claimed in a Monday interview with S&P Global Commodity Insights that the NNPCL had committed its crude to other organisations.
This is despite the fact that the NNPCL markets crude oil on Nigeria's behalf.
Source: UGC
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The head of the Dangote refinery declined to identify the other organisations that were receiving crude from the oil corporation.
Last month, the NNPC revealed that it had signed a $3 billion crude oil-for-loan agreement with the African Export-Import Bank.
In accordance with the agreement, the corporation assured the bank that it would receive future oil output as loan repayments.
Dangote refinery already importing crude oil
Edwin said Dangote Petroleum Refinery is already importing crude oil and anticipates receiving its first crude shipment in two weeks.
He, however, clarified that the refinery was temporarily importing crude. He said as from November, NNPCL would be supplying the company.
According to a senior official of the oil corporation, to ensure that Dangote's refineries' crude oil needs are satisfied in November, measures have already been put in place.
Edwin also revealed that the company would start producing up to 370,000 barrels per day of crude that would result in aviation fuel and automotive petrol oil, often known as diesel, in October 2023.
The project would generate Premium Motor Spirit, or fuel as it is more commonly known, by November 30, 2023, according to the Edwin.
Edwin added that the Dangote Refinery would start a gradual increase in fuel output with the goal of reaching an astonishing 650,000 barrels per day by November 30.
"Right now, I'm ready to receive crude," he said, emphasising the refinery's willingness to receive crude oil. All we have to do is wait for the first ship. Thus, we may begin as soon as it arrives.
While the expectation of the Dangote refinery is high for many, Financial analyst said it may take some time before Nigerians begin to fully enjoy the benefit of stationing the largest Africa's refinery in the country.
Samuel Oyekanmi, a financial analyst noted that the recent downstream oil sector deregulation appears like an area that would improve the level of transparency and by extension activities in the downstream oil sector.
He however added that there is still a lot to be done in terms of oil extraction and refining before impressive growth can be reflected in the oil sector.
He stated,
"The full implementation of Dangote Refinery is a potential growth propeller, however it will take time before we start seeing the full impact on the economy."
Dangote Inducts Graduate Trainees, Says 250,000 More Jobs To Be Created
In an earlier report by Legit.ng, Dangote Industries Limited reiterated its commitment to provide Nigerians with job opportunities.
In a statement, the company said its ongoing investments in vital economic areas to support job creation and the creation of decent jobs were irrevocable.
Aliko Dangote, the president of the Dangote Group, also said he is committed to creating employment during the induction of a new group of graduate trainees.
Source: Legit.ng
