The Federal Government has declared that the Nigerian National Petroleum Company Limited will be the exclusive purchaser of Premium Motor Spirit from Dangote Refinery.
Additionally, it stated that interested marketers must acquire the product through the national oil company’s trading subsidiary.
This decision is part of the agreement made with the management of Dangote Refinery regarding the commercial terms for supplying crude oil to the refinery, as well as the off-taking and distribution of petrol and diesel from the facility.
Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, announced this during a press briefing on Friday in Abuja.
This recent announcement, however, contradicts NNPC’s earlier statement at the beginning of the month, in which it claimed that it did not plan to be the exclusive distributor of petrol produced by the Dangote refinery.
The directive also suggests that the government retains the ability to influence the pricing of the product, as it will be determined by the agreement between the government and the refinery.
The minister, represented by Dr. Zacceus Adedeji, Executive Chairman of the Federal Inland Revenue Service, further stated that Dangote Refinery will begin distributing petrol to marketers on Sunday, with an initial supply of 25 million liters 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 NNPC, will commence on Sunday, September 15, 2024. And from October 1, NNPC will commence the supply of crude oil to Dangote Refinery to be paid for in naira. In return, Dangote Refinery will supply PMS and diesel of equivalent value to the domestic market to be paid for in naira.
But for now, PMS will only be sold to NNPC. NNPC will then sell to various marketers.”
The minister also stated that all related regulatory costs associated with the Nigeria Ports Authority, the Nigerian Maritime Administration and Safety Agency, and other entities would be settled in naira.
Regarding the approval to sell crude oil to local refineries in naira and to purchase petrol from these refiners in the local currency, Edun stated that this decision would alleviate pressure on the naira.
On July 29, the federal executive council endorsed a proposal by President Bola Tinubu, instructing the NNPC to sell crude oil to Dangote Refinery and other refineries in naira.
The minister indicated that this initiative would also remove unnecessary transaction costs and enhance the availability of petroleum products in the country.
