Plumbing the depths of Dangote Refinery, NNPCL Imbroglio

In the wake of the operationalisation of the Dangote Refinery earlier in the year, the national oil company, Nigerian National Petroleum Company Limited (NNPCL), has come under severe criticism, some justifiable and others unjustifiable.

The excoriation has become more strident and abrasive since the Dangote Refinery rolled out its Premium Motor Spirit (PMS) into the market. This trend was taken to a whole new level by one Adamu Rabiu, whose piece, titled, ‘Dysfunctional NNPCL vs God-sent Dangote Refinery,’ was published in The Guardian of October 3, 2024.

In the piece, the writer insists that the relationship between the Dangote Refinery and NNPCL is “fraught with contentions, subversion and sabotage.” He goes on to highlight specific areas and incidents, which he believed, lend credence to his assumption of a war between the two entities.

Unfortunately, his presentation of the incidents left much to be desired by any keen observer of the unfolding scenario, as they mostly fly against truth. For instance, he stated that NNPCL misrepresented its stake in the Dangote Refinery, claiming that it acquired 20 per cent stake when it actually acquired “a mere 7.2 per cent.”

This issue of stake acquisition by NNPCL is not something that happened long ago, such that people may have forgotten the details of how it happened. As a private citizen who has keenly followed the development since 2021, I think it is not right to allow the type of lies that the writer peddled in the to stand.

On the issue of the stake acquisition, which the writer accused NNPCL of misrepresenting, from every information available, it was just a case of someone desiring to buy a certain quantity of a particular product only to change his/her mind to buy a lesser quantity than earlier stated. What is the misrepresentation, and “looming issue of falsehood and misinformation” in that?

The second thing for which Rabiu pilloried the NNPCL is what he called Product Quality Concern, or what I will refer to as the Dirty Diesel Saga. In the writer’s skewed way of standing truth on its head, he narrated the incident to make it look as if the first salvo in the saga was fired by the NMDPRA.

He conveniently forgot that the first allegation about dirty fuel was made by the Vice President of the Dangote Industries Limited, Mr. Edwin Devakumar. He it was who first alleged that the regulator was licensing more companies to import dirty fuel into the country. It was very easy for anyone with half a brain to see through Devakumar’s game.

Is it not curious that it was only when Dangote Refinery started producing diesel that all the diesel being sold for years in the Nigerian market became dirty?

But the real lie and misinformation peddled in the argument by Rabiu was that “Dangote’s own tests on diesel imported by the NNPCL… showed a much higher ppm exceeding 1,800 and 2,000.” The truth, however, is that the diesel which was bought from filling stations and allegedly tested by Dangote was not imported by NNPCL. The company does not import diesel.

That was why Devakumar’s accusation was directed at independent marketers licensed by the NMDPRA. But Rabiu, apparently, was too blinded by his anti-NNPCL sentiments to know the truth or even seek to know the truth before setting pen on paper.

The third point and falsehood peddled in that piece is what the writer described as “Monopoly Accusation.” He didn’t state clearly who accused Dangote of monopoly, but it could be inferred from his reference to the NNPCL buying petrol from the Dangote Refinery at ₦898 per litre without allowing Dangote to state how much it sold the product that he was referring to the company.

The questions that arise from this argument are: One, was it the NNPCL that floated the allegation that marketers were importing dirty diesel in order to demonise the marketers and create a monopoly market for the Dangote Refinery in the diesel market?

Two, in what way did the NNPCL gag Dangote from disclosing how much it sold petrol to it when the company stated that it bought at ₦898 per litre? Does the NNPCL have the power or authority to bar Dangote from selling petrol to private marketers?

Clear, fair and factual answers to these questions would reveal the mendacity in Rabiu’s piece.

The fourth issue stated in the piece is that of “Crude Sales in Dollars.” His argument is that it is illegal to sell crude oil to Dangote in dollars since the legal tender in Nigeria is the Naira, and that the new arrangement to sell crude oil to Dangote in Naira was only a face-saving measure.

The writer, however, failed to tell Nigerians in what currency Dangote sells diesel to private marketers in Nigeria. The Dangote Refinery, in a press release issued on September 15, 2024, by the company’s spokesman, Mr. Tony Chiejina, clearly stated that it sold petrol to NNPCL in dollars, and not Naira. So, by Rabiu’s argument, Dangote is also a lawbreaker!

This leads to the fifth point raised in the piece ,which is “Pricing Dispute.” The writer agreed that the ₦898 per litre price that NNPCL stated that it bought from Dangote Refinery was “significantly higher than the imported product price.” Then he goes on to state that Dangote has refuted NNPCL’s claims that it bought at the stated price, “calling it misleading.”

But company that refuted NNPCL’s claim failed to state the price at which it sold its product to NNPCL. If you claim that someone is misleading the public, the right and germane thing to do is to provide contrary facts, in this case, state the figure at which you sold! So, who is deceiving whom, or who is scamming who here?

Rabiu’s sixth point is what he described as “Arrangement to Station NNPCL Personnel at the Dangote Refinery.” Obviously, the contention points to the fact that the writer believes that the Dangote Refinery, a God-given blessing to Nigeria, is above human and institutional regulations.

That is the very reason the refinery is arms with everyone, including the regulatory bodies- NMDPRA and NUPRC. The truth which Rabiu failed to acknowledge is that NNPCL has a whopping $1billion investment in the Dangote Refinery and is duty bound to ensure that its investment does not go waste.

The seventh point by Rabiu is what he referred to as “NNPCL’s struggling Refineries.” To be candid, the refineries have become a sore-thumb not only for NNPCL, but also for the country. It is not defensible that the refineries were allowed to get to the deplorable state where they have to require a complete retooling.

But to allege fiscal irresponsibility in the financing of the refinery rehabilitation, as Rabiu did, is not correct. NNPCL is funding the rehabilitation project with loans and not taxpayers’ money, as he alleged. The implication of this is that the lenders are keenly involved in the exercise, which gives no room for lack of accountability and transparency.

Yes, there is delay in the start-up of the Port Harcourt Refinery. Start-up difficulty is nothing new in projects like this. The Dangote Refinery had a similar experienced. That was why it didn’t start production until May this year, despite the fact that it was commissioned in May 22, last year, almost a full year. But after the delay, Dangote Refinery came on stream.

And so will the Port Harcourt Refinery, and indeed the Warri and Kaduna Refineries, for the good of our country.

-Umar Abuja-based public affairs analyst