Economy
Dangote Disclaims Fuel Concerns, Says Refinery’s Petrol Sold Below Import Cost
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Dangote disclaims fuel price concerns, says refinery’s petrol sold below import cost
By Aisha Musa
Alh. Aliko Dangote, the CEO of Dangote Refinery, has addressed concerns over fuel pricing, clarifying that petrol from his refinery was sold to the Nigerian National Petroleum Company (NNPC) Limited at a rate lower than the cost of imported fuel.
While explaining in an interview with Bloomberg TV on Monday, he said the national oil company was simultaneously purchasing petrol from his refinery and importing around 800,000 metric tonnes of petrol into Nigeria.
Dangote further emphasised that the petrol NNPC imported during this period was significantly more expensive than the fuel sold by his refinery, which has a capacity of producing 650,000 barrels per day.
He said: “What’s going on is not a disagreement per se. NNPC bought from us this particular one on the 15 of September at the international price. They also bought over 800,000 metric tonnes of gasoline imported.
“The ones they bought from us were cheaper than the ones they imported. So when they announced our price, it wasn’t the real price. What they announced was likely what it cost them including profits and other things. Meanwhile, they’ve never added profit to their cost before.
“And then, the other one is what they imported but the people don’t know how much they spend for importing. But their own importation was about fifteen to 20 percent more expensive than ours. What they first do is to sell at a basket price. If they want to remove subsidy, they can announce that they’ve removed subsidy. Everybody will adjust.”
The NNPC had earlier announced that the Dangote Refinery sold petrol to them at N898 per litre after the first batch of offtake from the facility.
In response, the Dangote Group issued a statement refuting NNPC’s claim, explaining that the quoted N890 per litre does not represent the actual national price. According to the group, they sold the petrol to NNPC at a considerably subsidized rate, given the circumstances surrounding their crude oil acquisition.
Dangote Group further clarified that they purchase their crude oil from international suppliers in dollars, and this international market dynamic affects their pricing structure that was at fault and the entire oil sector be overhauled.
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