We reduced stake in Dangote refinery to invest in CNG, says NNPC

The Nigerian National Petroleum Company (NNPC) Limited says its stake in Dangote Petroleum Refinery was reduced to 7.2 percent to invest in compressed natural gas (CNG).

Femi Soneye, NNPC’s spokesperson, spoke during a Brekete Family programme on Monday.

In September 2021, NNPC acquired a 20 percent interest in Dangote refinery for $2.76 billion. 

However, on July 14, Aliko Dangote, Africa’s richest person, said the national oil company now owns 7.2 percent stake in the refinery.

Also, Soneye said the company does not have any issues with Dangote refinery, adding that NNPC was not collaborating with the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to sabotage the refiner.

“The reason for reducing our stake in Dangote refinery is because we wanted to invest in CNG. We observed that CNG is very cheap and all over the world, people are investing in clean and cheaper alternative energy,” Soneye said.

He said if Nigerians use CNG, it will be cost-effective for them. 

“That is why the NNPC is building different CNG stations everywhere. We understand that with N10,000, Nigerians can fill their cars and use it for two weeks. We realised that gas is cheaper in Nigeria, why don’t we invest in it since this is what people are doing all over the world?” Soneye said.

The spokesperson said the Petroleum Industry Act (PIA) does not give NNPC the power to stop the Dangote refinery.

“We want all Nigerians to know that the NNPC does not have any issue with the Dangote Refinery. We are part of the owners of the Dangote refinery and we don’t want it to collapse,” Soneye said.

“We invested billions of naira into the Dangote refinery. As of today, we have a 7.2 per cent stake in the refinery. So, why would we want to sabotage such a company?”

DANGOTE REFINERY VS NMDPRA 

Soneye said anytime Farouk Ahmed, NMDPRA’s chief executive officer (CEO), speaks about the Dangote refinery, it is in his capacity as a regulator in charge of all operators in the midstream and downstream, including the NNPC.

“Mr Farouk Ahmed is the head of Nigeria’s mainstream and downstream petroleum regulatory authorities. They have power over all refineries. Anything that has to do with the distribution of petrol, they are in charge. In fact, they are superior to the NNPC in that sector. We don’t have anything to do with them,” he said.

NMDPRA and Dangote refinery have been embroiled in a dispute.

On July 18, Ahmed said local refineries, including the Dangote Petroleum Refinery, were producing inferior products compared to the ones imported into the country.

He also said Dangote requested all importation of petroleum products — especially automotive gas oil (AGO) or jet kero — be suspended or stopped, and all oil marketers be directed to his refinery.

However, Dangote denied Ahmed’s claim.