Dangote Accuses Oil Marketers and International Oil Companies of Sabotaging Lekki Refinery Project

Aliko Dangote, Africa’s richest man and founder of the $20 billion Dangote Petroleum Refinery in Lekki, has accused certain oil marketers and international oil companies (IOCs) of deliberately undermining his refinery’s operations. He alleges that these entities, benefiting from Nigeria’s history of subsidized fuel imports, are resisting the refinery's efforts to supply domestically refined products.

Allegations of Market Resistance

Devakumar Edwin, Vice President of Oil and Gas at Dangote Industries Limited, stated that only about 3% of local oil marketers are purchasing products from the refinery. This low patronage has forced the facility to export approximately 97% of its refined diesel and aviation fuel, despite offering prices below the prevailing market rates. Edwin noted that some marketers even complained to President Bola Tinubu about the refinery's competitive pricing.

Crude Supply Challenges

Edwin also accused IOCs of obstructing the refinery's access to local crude oil by inflating premium prices above market rates, compelling the refinery to import crude from distant countries like the United States, leading to significantly higher costs.

Regulatory and Legislative Responses

In response to these challenges, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) announced that it would deny export permits to oil producers who fail to meet their domestic refinery quotas, as mandated by the Petroleum Industry Act. This move aims to ensure that local refineries, including Dangote's, receive adequate crude supplies.

Additionally, the House of Representatives has resolved to set up an ad hoc committee to investigate the alleged conspiracy by IOCs against the Dangote Refinery. The committee will also probe the inability of NNPC Limited to acquire a 20% stake in the refinery.

Dangote's Determination

Despite these obstacles, Dangote remains resolute. He has publicly stated that both local and international entities have attempted to sabotage the refinery project, comparing the oil industry's resistance to that of a powerful mafia. Nevertheless, he believes that the support of the Nigerian population and government will ultimately ensure the refinery's success.

The Dangote Refinery, with a capacity of 650,000 barrels per day, is poised to significantly reduce Nigeria's dependence on imported fuel. However, its success hinges on overcoming these supply and market challenges.