The focus needs to shift to supporting the efforts by the NNPC to curb the rampant oil theft that has defined the industry for decades.
INVESTIGATION: How Nigeria can resolve its multi trillion naira post-harvest losses INVESTIGATION: Poverty, shambolic education system keeping children out of school in Niger StateSPECIAL REPORT: In Northwest Nigeria, insecurity is fueling medical desertsThe disconnect between matter, energy and chronic disease management, By Mukaila KareemINVESTIGATION: How Nigeria can resolve its multi trillion naira post-harvest losses INVESTIGATION: Poverty, shambolic education system keeping children out...
The events of the last two months have, however, been rather dampening, starting with the statement by the Vice President, Oil and Gas, at Dangote Industries Limited, Devakumar Edwin, accusing international oil companies in Nigeria of frustrating the Dangote Refinery “to ensure that Nigeria remains a country which exports Crude Oil and imports refined Petroleum Products.
One would think that the issues that have pitched Aliko Dangote, the largest single investor in the industry with one of the largest refineries in the world, on the “war path” with regulators in the industry are not beyond what can be resolved in the boardroom, rather than at a public sitting in the National Assembly.
But this is not to summarily dismiss Dangote Refinery’s push for supply of crude based on the Domestic Crude Oil Supply Obligation , as enunciated under section 109 of the Petroleum Industry Act , and simply wave a pass at the Nigerian Upstream Petroleum Regulatory Commission , without asking questions.
Despite this, the Nigerian Upstream Petroleum Regulatory Commission’s claims to have facilitated the provision of crude to nine refineries over time, using the instrumentality of the DCSO. Between 2019 and 2021 when the Petroleum Industry Act came into effect, 1,726,049 barrels of oil were supplied to two refineries – Waltersmith and NDPR, according to the NUPRC.
How much of that oil is available to NNPC, after it has met its obligations under the forward sales agreements and other contracts, having made provision for supply to its refineries, is better imagined.
Going forward, NNPCL is expecting to soon have its refineries returning to operations, starting with the one in Port Harcourt, which would require feedstock as well. That might then suggest that NNPCL is encumbered on too many fronts to be able to successfully meet the demand by Dangote Refinery Limited for a 300,000 bpd delivery. Is there room for AfreximBank to ‘restructure’ the current 90,000 barrels per day deal tied to the US$3.
It is not too late to get everyone back in the boardroom to fashion out a win-win solution, with Nigeria’s energy security and national interest guaranteed. One of the stated objectives, according to Dangote in setting up the Refinery, is for Nigeria’s energy security. The same interest is what motivated NNPC Limited to invest in the Dangote Refinery, while recommitting itself to the rehabilitation of its refineries. It defies logic that NNPC Limited, having invested $1 billion for a 7.
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