By Chidinma Ume
The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has raised concerns over the N990 per litre petrol pricing set by the Dangote Refinery, criticizing the rate as excessive given the concessions and access to foreign exchange the company received during construction.
PETROAN argued that imported petrol remains more affordable than the Dangote refinery’s pricing, noting that the latest landing cost of imported fuel, as reported by major marketers on October 31, 2024, was around N978 per litre.
Responding to accusations made by Dangote Refinery that PETROAN and the Independent Petroleum Marketers Association of Nigeria (IPMAN) planned to import substandard petroleum products, PETROAN Publicity Secretary Joseph Obele, in a Monday statement, clarified, “PETROAN will sell far less than the current selling rate of PMS in Nigeria when granted an import license by the Nigerian Midstream and Downstream Petroleum Regulatory Authority.”
Obele emphasized PETROAN’s commitment to ensuring stability in Nigeria’s downstream sector, describing the association’s goals as patriotic and solution-oriented, in line with President Bola Tinubu’s reformative agenda. He remarked that monopolistic control in the market would harm consumers by reducing competitive pricing.
Refuting Dangote’s claims, Obele said, “The publication by Dangote refinery that PETROAN will import substandard petroleum products is not surprising. It’s a familiar tactic aimed at protecting a monopoly. The statement came right after PETROAN and IPMAN announced intentions to introduce more competitive pricing for PMS in Nigeria.”
Obele stressed that PETROAN intends to enter the market before December 2024, with quality petrol at a lower price, subject to import approval and foreign exchange at the official rate. “We have concluded arrangements with international refinery partners and financial backers to provide premium-quality PMS well below the current market rate,” he confirmed.
He added that the Dangote refinery’s refusal to disclose pricing until recently, combined with its significant concessions for foreign exchange access, make the current N990 rate unjustifiable. “The pricing basis should have been rooted in production costs plus a fair margin, not solely international market comparisons, especially given the national concessions received.”
Obele further highlighted market examples, explaining that, “Goods from China aren’t priced as high as those from the U.S. because of lower production costs. The same principle should apply here.” He warned that allegations from Dangote Refinery about inferior product imports are tactics to discourage market competition.
Recent comments by Dangote’s CEO, questioning the quality of products from the Nigerian National Petroleum Company (NNPC) Ltd and describing Malta’s refinery as merely a blending plant, indicate a pattern aimed at reducing competitor access to the market, according to PETROAN.
Expressing support for Tinubu’s focus on national refinery revamps, PETROAN suggested privatising Port Harcourt and Warri refineries to credible partners with financial and managerial expertise, in collaboration with PETROAN and other stakeholders. This approach, Obele explained, would bolster state-owned refineries to compete effectively in the marketplace.
The association advocated for a transparent privatisation process, referencing Indorama Petrochemicals as a model and rejecting the Maintenance Repairs and Operations (MRO) contract approach.
In response, IPMAN National Secretary Terlumun James denied plans for any blending plant, adding, “We need all stakeholders to unite to provide affordable energy to Nigerians.” He noted that IPMAN is actively pursuing an import license and negotiating with Dangote Refinery.
Dangote Group’s spokesperson, Anthony Chiejina, recently alleged that an international company had rented a depot near the Dangote Refinery with intentions to blend lower-grade products to compete in the market. However, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) declined to comment on the claim.