Tag: Dangote Group of Company Nigeria

Dangote Refinery has suspended the sale of petroleum products to domestic market in Naira following the failure of the Federal Government to renew the crude-for-Naira deal the company had with Nigerian National Petroleum Company Limited (NNPCL)

The refinery, in a statement yesterday, said: “Dangote Petroleum Refinery has temporarily halted the sale of petroleum products in Naira. This decision is necessary to avoid a mismatch between our sales proceeds and our crude oil purchase obligations, which are currently denominated in U.S. dollars.

“To date, our sales of petroleum products in Naira have exceeded the value of Naira-denominated crude we have received. As a result, we must temporarily adjust our sales currency to align with our crude procurement currency.

“Our attention has also been drawn to reports on the internet claiming that we are stopping loading due to an incident of ticketing fraud. This is malicious falsehood. Our systems are robust and we have had no fraud issues.

“We remain committed to serving the Nigerian market efficiently and sustainably. As soon as we receive an allocation of Naira-denominated crude cargoes from NNPC, we will promptly resume petroleum product sales in Naira.

“We appreciate your understanding and cooperation during this period”.

The President of the Dangote Group, Alh. Aliko Dangote, met the Minister of Finance and Coordinating Minister of the Economy, Mr.Wale Edun, in Abuja on Tuesday, in what was seen as the last minute attempt to sustain the Naira for Crude deal to no avail.

When the media last week reported that the Federal Government, through the NNPCL, had stopped the Naira for Crude deal, the government denied.

But going by the current position of Dangote Refinery, it is obvious that the arrangement has been shot down.

Its implication would be far reaching in escalating products prices and exacerbating the challenges of obtaining the US Dollars at the foreign exchange market.

It would worsen the dollarisation of the Nigerian economy, an aberration which the federal government said it was fighting, at a point.

Oil marketers have warned that petrol pump prices may rise in the coming days following Dangote Refinery’s decision to suspend the sale of petroleum products in Naira to the domestic market.

The refinery had been in discussions with the Federal Government over renewing its six-month crude-for-Naira agreement with NNPC Limited.

The deal, which was set to expire this month, was reportedly terminated by the national oil company two weeks ago. Negotiations between the government and the involved parties ended without an agreement in Abuja on Tuesday.

Dangote Refinery in a statement on Wednesday said: “We wish to inform you that Dangote Petroleum Refinery has temporarily halted the sale of petroleum products in Naira. This decision is necessary to avoid a mismatch between our sales proceeds and our crude oil purchase obligations, which are currently denominated in U.S. dollars.

“To date, our sales of petroleum products in Naira have exceeded the value of Naira-denominated crude we have received. As a result, we must temporarily adjust our sales currency to align with our crude procurement currency.

“Our attention has also been drawn to reports on the internet claiming that we are stopping loading due to an incident of ticketing fraud. This is malicious falsehood. Our systems are robust and we have had no fraud issues.

“We remain committed to serving the Nigerian market efficiently and sustainably. As soon as we receive an allocation of Naira-denominated crude cargoes from NNPC, we will promptly resume petroleum product sales in Naira.

“We appreciate your understanding and cooperation during this period”.

Speaking to Vanguard on the impact of Dangote’s decision, the Public Relations Officer, Independent Petroleum Marketers Association of Nigeria, IPMAN, Chief Chinedu Ukadike said pump price would likely go up due to the cost of sourcing foreign exchange to pay for the product.

He pointed out that marketers may also resort to selling their petroleum products in dollars as the currency has now become the means of exchange in Nigeria.

“The pressure on dollar will increase because it has become the means of exchange. Marketers will begin to sell petrol at filling stations in dollars. And this will have negative impact on the prices of petroleum products across the country.

“We don’t want to cause panic in the energy industry but what we are seeing now is not encouraging. Any increase in cost will be passed on to consumers eventually”, he added.

He said the marketers were informed that the crude for Naira deal ended March 1, 2025, contrary to claims made by government officials.

The Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, had told journalists last weeek that the Naira-for-Crude deal between NNPC Limited and Dangote Refinery remained intact and has not been canceled.

He pointed out that the agreement as was approved by the Federal Executive Council (FEC), was still in effect.

Lokpobiri stated that while NNPC operates a private sector model, the government still has limited control over major decisions, adding that operators in the oil and gas industry were free to transact business in any currency.

According to him, “Government is not canceling it. What was taken to council was a pilot scheme where they said NNPC should be selling crude in Naira to Dangote Refinery. We’ve always encouraged people to buy crude in whatever currency. Even if you buy in Naira, it’s going to be at a prevailing exchange rate.

And I do know that people have been buying crude to refine in their respective local refineries in Naira.

“The dispute has always been, what is the exchange rate? Which the government is not involved. It is purely private sector issue. If you are in the upstream and you have a modular refinery next to you and the man wants to buy crude, it’s between two of you that would negotiate and agree on what price. And the person may decide to pay you either in dollars or in Naira.

“We’ve always done that. So it is not true that the scheme is canceled. Not at all. That one that was taken to FEC was a scheme specifically for Dangote Refinery and they said orders will also follow. And that was why that one didn’t include the crude for Naira from IOCs and other operators. It was basically only NNPC”.

On his part, NNPC Limited also clarified that the contract for the sale of crude oil in Naira was structured as a six-month agreement, subject to availability, and expires at the end of March 2025.

It added that “discussions are currently ongoing towards emplacing a new contract.

Under this arrangement, NNPC has made over 48 million barrels of crude oil available to Dangote Refinery since October 2024. In aggregate, NNPC has made over 84 million barrels of crude oil available to the Refinery since its commencement of operations in 2023.

“NNPC Limited remains committed to supplying crude oil for local refining based on mutually agreed terms and conditions.”

Lagos – The Dangote Group and its subsidiaries have disclosed that they paid over N402.3 billion in taxes to the government in 2024, making them the highest taxpayers in the country.

Chief Branding and Communication Officer, Anthony Chiejina, made this known during a meeting with senior media executives in Lagos. He stated that the payments were made by Dangote Industries Limited (DIL) and its subsidiaries, including Dangote Cement, NASCON, and Dangote Packaging Limited, as part of their commitment to responsible business practices.

The Federal Inland Revenue Service (FIRS) had earlier recognized Dangote Industries Limited and its subsidiary, Bluestar Shipping, as the most tax-compliant organizations in Nigeria during the 2024 Lagos International Trade Fair.

Chiejina emphasized that the Dangote Group remains committed to fulfilling its tax obligations and contributing to national development. He also highlighted the conglomerate’s role in making Nigeria self-sufficient in cement and refined petroleum products, while continuing its expansion across Africa.

Additionally, Dangote Cement received multiple recognitions at the FMDQ Gold Awards in Lagos, winning accolades for the Largest Commercial Paper Quotation, Single Largest Corporate Debt Issue, and the Most Active Corporate in the Foreign Exchange Market.

Dangote Petroleum Refinery has exported two jet fuel cargoes to Saudi Arabia’s Aramco, the world’s largest oil producer and a leading integrated oil and gas company.

Saudi Aramco is the official Saudi Arabian Oil Company, which is a majority state-owned petroleum and natural gas company.

President of Dangote Group, Aliko Dangote, revealed this on Tuesday during a visit by the Nigerian Economic Summit Group (NESG) team to both Dangote Fertiliser Limited and the Dangote Petroleum Refinery & Petrochemicals in Ibeju Lekki, Lagos.

Dangote said exporting products to the global markets, especially Saudi Aramco, was because of his refinery’s world-class standards and advanced technologies.

“We are reaching the ambitious goals we set for ourselves, and I’m pleased to announce that we’ve just sold two cargoes of jet fuel to Saudi Aramco,” he said.

While commending Aliko Dangote for establishing the $20 billion refinery – the largest single-train refinery in the world – NESG Chairman, Mr. Niyi Yusuf, stated that Nigeria needs more investments of this calibre to reach its $1 trillion economy goal.

“To achieve a $1 trillion economy, much of that must come from domestic investments. This refinery, fertiliser plant, petrochemical complex, and supporting infrastructure are monumental,” he said.

Yusuf emphasised that such local industries are essential to Nigeria’s industrialisation and will help foster the growth of Small and Medium Enterprises (SMEs). He added that the NESG would continue to advocate for an

improved investment climate to attract entrepreneurs, boost development, ensure food security, and address insecurity.

Dangote, in his response, reiterated the importance of the private sector in national development, asserting that Nigeria’s challenges could largely be overcome by providing gainful employment to its people.

He stated that the concept of a free market should not be used as a pretext for continued import dependence, highlighting that both developed and developing nations, including the USA and China, actively protect their domestic industries to safeguard jobs and promote self-sufficiency.

Dangote Petroleum Refinery has reduced the ex-depot (gantry) price of Premium Motor Spirit (PMS), also known as petrol to N890 per litre, from N950 per litre, effective from Saturday, February 1, 2025.

The price of crude oil, including Nigeria’s Bonny Light, a major feedstock, dropped to $75.67 per barrel, from over $80 per barrel in the international market.

However, Dangote Petroleum Refinery said the price reduction was based on developments in the global oil market, adding that it remains committed to transparency and fairness to all stakeholders.

In a statement, the company, stated: “This strategic adjustment is a direct response to the positive outlook within the global energy and gas markets, as well as the recent reduction in international crude oil prices.

As part of Dangote Refinery’s unwavering commitment to transparency and fairness, this price revision reflects the ongoing fluctuations in global crude oil markets, as highlighted in the refinery’s statement on 19th January, when a modest increase was implemented due to the previously rising international crude oil prices.

“Dangote Petroleum Refinery firmly believes that this reduction from N950 to N890 will result in a meaningful decrease in the cost of petrol nationwide, thereby driving down the prices of goods and services, as well as the overall cost of living, with a positive ripple effect on various sectors of the economy.”