Aliko Dangote Claims IOCs Are Undermining Dangote Refinery Operations

Devakumar Edwin, Vice President of Oil and Gas at Dangote Industries Limited (DIL), has accused international oil companies (IOCs) operating in Nigeria of sabotage at the Dangote Oil Refinery and Petrochemicals.

Edwin argues that the IOCs are purposefully undermining the refinery’s efforts to source local crude oil by imposing high premium pricing, forcing the company to purchase petroleum from distant countries such as the United States, incurring significant costs.

Edwin highlighted concerns about the Nigerian Midstream and Downstream Petroleum Regulatory Authority’s (NMDPRA) actions during a one-day training event for energy editors organized by the Dangote Group. He chastised the regulator for providing licenses to marketers without regard for quality, allowing unclean refined items to enter Nigeria.

“The Federal Government awarded 25 licenses to build refineries, and we are the only one that followed through on our pledge. “We deserve every support from the government,” Edwin added.

“Since the commencement of manufacturing, more than 3.5 billion liters, or 90% of our output, have been exported. We urge the federal government and regulators to provide us with the resources we need to create jobs and prosperity for the country,” he said.

Edwin highlighted the plant’s issues, noting that the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is doing its utmost to allocate crude oil to the refinery. However, the IOCs are purposefully impeding efforts to buy domestic crude.

“The IOCs are either charging exorbitant fees or stating that crude is unavailable. At another point, we paid $6 more than the market price, requiring us to limit output and import oil from as far away as the United States, raising our production costs,” Edwin complained.

He accused the IOCs of devising a strategy to keep Nigeria dependent on crude oil exports and refined petroleum product imports.

“The IOCs export raw materials to their home countries, creating jobs and income for themselves, while dumping expensive refined products in Nigeria. “This exploitation has resulted in unemployment and poverty in Nigeria and Sub-Saharan Africa,” Edwin stated.

Edwin also chastised the NMDPRA for giving licenses that allow the import of high-sulfur diesel and other hazardous goods despite the refinery’s adherence to ECOWAS rules and norms.

“Traders are being awarded licenses to acquire exceptionally high-sulfur fuel from Russia and dump it in the Nigerian market. Since the US, EU, and UK set a price ceiling on Russian petroleum products on February 5, 2023, many tankers carrying Russian ultra-high sulfur diesel have been waiting near Togo before being acquired and dumped into the Nigerian market, he disclosed.

Belgium and the Netherlands recently established new quality rules to prohibit the sale of low-quality fuels to West Africa, bringing them in line with the European Union’s standards. Zakia Khattabi, Belgium’s Minister of Environment, emphasized the negative impact of toxic fuels on air quality in nations such as Nigeria, Ghana, and Cameroon, pointing out that they are carcinogenic.

In September 2017, the worldwide organization Public Eye discovered that dirty and dangerous fuels were being shipped on a big scale from the ports of Rotterdam and Amsterdam to African markets. These fuels have high quantities of sulfur and benzene, which exceed European regulations.

The NMDPRA’s decision to approve licenses for importing filthy diesel and aviation fuel has compelled the Dangote refinery to expand into global markets.

Despite these hurdles, the refinery has successfully exported diesel and aviation fuel to Europe and other areas of the world, in accordance with international standards and severe rules.

Edwin urged the Federal Government and the National Assembly to intervene immediately and ensure full implementation of the Petroleum Industry Act (PIA) to preserve Nigeria’s interests.

“The government of Ghana has prohibited the importation of highly polluted diesel and PMS. It is unfortunate that Nigeria continues to issue import licenses despite our ability to produce nearly double the quantity required domestically and export the surplus. He underlined that since January 2021, ECOWAS standards have prohibited the import of highly polluted diesel.

As the Dangote refinery continues to confront challenges, the appeal for government backing and stronger restrictions is critical to the advancement of Nigeria’s oil industry and economic development.

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