PRESS RELEASE
Dangote Refinery Slashes Petrol Price, Clarifies Claim by NNPCL
The Dangote Petroleum Refinery has announced a 7.26% reduction in the price of its Premium Motor Spirit or Petrol, to 889.50 Naira per litre from Wednesday 18th December 2024, the second price reduction for sale to marketers within one month (the exchange rate is 1,500 Naira to 1USD).
With this latest reduction, oil marketers can buy a minimum of two million litres of PMS at 889.50 Naira per litre from the Dangote refinery, against 970 Naira per litre from 24 November 2024.
As part of the “Season’s Bonanza,” aimed at appreciating its customers, for their loyalty and support, Dangote Refinery also offers marketers a deal of buying one truckload of PMS and another on a 15-day interest-free credit guaranteed by any of the three banks it mentioned.
The marketers usually sell the product to final consumers from the filling stations at a slightly higher price as part of administrative cost. PMS currently sells at 1,030 Naira at NNPC filling stations and more than 1,100 Naira at other stations depending on the location.
Meanwhile, Dangote Industries Limited (DIL) has clarified a report attributed to the NNPCL that their decision to secure a US$1 billion loan backed by its crude was instrumental in supporting the Dangote refinery during liquidity challenges.”
“We would like to clarify that this is a misrepresentation of the situation as US$1 billion is just about 5% of the investment that went into building the Dangote Refinery,” Anthony Chiejina, Dangote Group Chief Branding and Communications Officer, said in a statement. “Our decision to enter into a partnership with NNPCL was based on recognition of their strategic position in the industry as the largest off-taker of Nigerian crude and at that time, the sole gasoline supplier in Nigeria.”
He explained that the Dangote Group had agreed to sell “a 20% stake” of the refinery at US$2.76 billion.
“Of this (amount), we agreed that they (NNPCL) will only pay US$1 billion while the balance will be recovered over 5 years, through deductions on crude oil that they supply to us and from dividends due to them,” the statement said. “If we were struggling with liquidity challenges, we wouldn’t have given them (NNPCL) such generous payment terms.”
The statement noted: “Unfortunately, NNPCL was later unable to supply the agreed 300 thousand barrels a day of crude given that they had committed a greater part of their crude cargoes to financiers with the expectation of higher production which, they were unable to achieve.
“We subsequently gave them 12 months to pay cash for the balance of their equity given their inability to supply the agreed crude oil volume. NNPCL failed to meet this deadline which expired on 30th June 2024,” the statement said, adding: “As a result, (NNPCL) equity share was revised down to 7.24%.”
“It is, therefore, inaccurate to claim that NNPCL facilitated a US$1 billion investment amid liquidity challenges. Like all business partners, NNPCL invested, US$1 billion in the Refinery to acquire an ownership stake of 7.24% stake that is beneficial to its interests,” the statement affirmed, noting; “NNPCL remains our valued partner in progress, and it is imperative for all stakeholders to adhere to the facts and present the narrative in the correct context, to guide the media in reporting accurately for the benefit of our stakeholders and the public.”
Dangote Refinery is one of a score of private refineries licensed by the Nigerian government to end the embarrassing development of an oil-producing nation relying on imported petroleum products after four state-owned refineries were run aground resulting in incessant hardship and domestic shortages.
The Dangote refinery, a US$20 billion investment by Africa’s richest man, Alhaji Aliko Dangote, is the World’s largest single-train refinery capable of processing about 650,000 barrels of crude per day, enough to meet Nigeria’s domestic consumption and surplus for export.
