Dangote Refinery
The Independent Petroleum Marketers Association of Nigeria (IPMAN) is set to hold discussions with Dangote Petroleum Refinery on Tuesday and Wednesday to finalise agreements on the cost and lifting of petrol from the plant.
It was learnt on Sunday that the Petroleum Retail Outlet Owners Association of Nigeria (PETROAN) has been asked by the $20bn Lekki-based refinery to resend its request for petrol lifting.
This came as PETROAN expressed optimism that the cost of petrol might reduce in the coming days once the competition in the downstream oil sector sets in fully, as marketers load the commodity from the refinery.
However, IPMAN describes the planned agreement with Dangote refinery as a vital step in the association’s ongoing efforts to facilitate the lifting of petroleum products, thereby contributing to the stability and efficiency of the country’s fuel supply chain.
Last week, the Federal Government granted permission for petroleum marketers to lift petrol directly from Dangote refinery, bypassing the Nigerian National Petroleum Company Limited (NNPC).
The Minister of Finance and Chairman of the Naira-crude sale implementation committee, Wale Edun, had in a statement, said, “Moving forward, petroleum product marketers are now able to purchase PMS (petrol) directly from local refineries without the intermediary role of NNPC.” He continued, “Marketers are encouraged to initiate direct purchases from refineries on mutually negotiated commercial terms, which will promote competition and improve market efficiency.”
The National Publicity Secretary of IPMAN, Chinedu Ukadike, on Sunday said, the association hoped to meet with officials of the Dangote refinery for discussion as it is ready to commence a healthy business relationship with the refinery.
Ukadike, in an interview on Arise TV, said the association had acquired tank farms to enhance its storage facilities, thus addressing a challenge that had previously hindered operations.
He said, “We hope to sit down with Dangote maybe Tuesday or Wednesday and if they give us a template or price, we will move to Dangote.” He added, “I want to reassure you that we have all it takes to off-take whatever Dangote will give to us.”
“The more we take action in terms of distribution lines, the price will come down, we are not afraid of this competition, we have organised ourselves and are ready to compete because this is the survival of the fittest.”
PETROAN President, Billy Gillis-Harry, also expressed optimism, stating that their group was in communication with Dangote officials to finalise lifting arrangements. He noted that prices could potentially fall to N700/litre, depending on market conditions.
In addition, Ukadike says that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has issued a bulk purchase license to independent marketers to facilitate off-take from Dangote. The government has also promised import licenses to marketers as part of ongoing deregulation efforts.
Ukadike highlighted that independent marketers are struggling with the rising costs of fuel purchases since the removal of subsidies, urging the government to support the sector by creating an energy bank to provide financial assistance.
“Before the subsidy removal, we purchased petrol at N8.1 million per truckload. Now, it’s nearly N50 million, which is unsustainable for many marketers,” Ukadike added.
