‘IOCs not supplying us’ — Dangote refinery seeks NUPRC’s intervention to meet crude requirement

The Dangote Petroleum Refinery says it is still unable to secure its full crude requirement from domestic producers, calling for the intervention of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

On August 8, the refinery had said since it commenced full operations, it has processed 50 million barrels of crude — with 60 percent of it coming from the Nigerian National Petroleum Company (NNPC) Limited.

However, reports claimed that the refinery’s position was different from its previous stance on crude supply by the NNPC.

Denying the claims in a statement, Anthony Chiejina, group chief branding and communications officer, said the company has never alleged that the NNPC is not supplying the refinery with crude.

He called on the NUPRC to ensure local companies meet their domestic crude supply obligations.

“Our attention has been drawn to media reports alleging that the Dangote Refinery has backtracked by acknowledging that NNPC supplied about 60 percent of the 50 million barrels we lifted,” he said.

“To clarify, we have never accused NNPC of not supplying us with crude. Our concern has always been NUPRC’s reluctance to enforce the domestic crude supply obligation and ensure that we receive our full crude requirement from NNPC and the IOCs.

“For September, our requirement is 15 cargoes, of which NNPC allocated six. Despite appealing to NUPRC, we’ve been unable to secure the remaining cargoes. When we approached IOCs producing in Nigeria, they redirected us to their international trading arms or responded that their cargoes were committed.”

Consequently, Chiejina said the refinery purchased the same Nigerian crude from international traders at an additional “$3-$4 premium per barrel — translating to $3-$4 million per cargo”.

“We therefore still insist that we are unable to secure our full crude requirement from domestic production and urge NUPRC to fully enforce the domestic crude supply obligation as mandated by the PIA,” Chiejina said.

On June 4, Aliko Dangote, Africa’s richest person, said some international oil companies (IOCs) are struggling to supply crude to his refinery.

Speaking on Arise TV on July 15, Gbenga Komolafe, chief executive officer of the NUPRC, described the claim as “erroneous”, noting that the Petroleum Industry Act (PIA) has provisions that guide willing buyer-willing seller transactions.

But a few days later, the management of Dangote Industries Limited (DIL) insisted that the IOCs were frustrating its request to purchase crude feedstock for the refinery.