AON agrees to stop buying imported jet fuel, patronise Dangote Refinery

The Federal Government has announced that domestic airlines, under the Airline Operators of Nigeria (AON), will now source their Jet A1 fuel from the Dangote Petrochemical Refinery, rather than relying on imported supplies.

The Minister of Aviation and Aerospace Development, Festus Keyamo, while speaking when he was featured on Channels Television’s Political Paradigm on Tuesday, said that this shift is expected to result in a significant reduction in airfares across the country.

Keyamo revealed that airline operators have agreed to make the 650,000 barrels per day refinery the sole provider of jet fuel in the aviation sector, following his endorsement.

“The Airline Operators of Nigeria just met. They have made a clear decision, and all of them will no longer buy imported fuel,” Keyamo said, adding that airline operators’s decision was to support a local industry, Dangote Refinery.

He added that though it was the decision of the AON, the move got his “push and blessing that they should only buy from Dangote Refinery, the Jet A1″.

He noted that this decision coincides with the government’s recent implementation of a naira-for-crude agreement with Dangote.

“This arrangement will help alleviate the pressure on Nigeria’s foreign exchange,” Keyamo stated. He said that with this agreement, airline operators will exclusively purchase Jet A1 fuel from Dangote refinery.

“We started a naira-for-crude purchase with Dangote, which is entirely in naira, with no dollar component,” he added.

The minister explained that sourcing fuel from Dangote will protect airline operators from the volatility of crude oil prices, ultimately lowering their operational costs, noting that the price will no longer be subject to international market fluctuations, therefore, making costs more predictable.

In April, the Dangote refinery commenced operations, producing jet fuel and diesel, with diesel reaching the local market shortly after. Following its domestic supply, the refinery began exporting jet fuel, with its first shipment departing for Europe.

On May 27, the vessel Doric Breeze left the Lekki Free Zone in Lagos carrying 45,000 metric tons of jet fuel bound for Rotterdam, Netherlands. This shipment was part of a larger tender of 120,000 metric tons, with BP and Spanish refiner Cepsa also receiving allocations.

To date, Dangote has exported six cargoes of jet fuel and kerosene, delivered to Senegal, Togo, and Ghana.