Dangote Refinery Threatens to Export Petrol Amid Local Market Blockade

The Dangote Petroleum Refinery has announced that it may be forced to export its Premium Motor Spirit (PMS), commonly known as petrol, if the Nigerian National Petroleum Company Limited (NNPCL) and other local petroleum dealers continue to avoid purchasing its products.

Devakumar Edwin, Vice President of Oil and Gas at Dangote Industries Limited, made this statement on Monday during an appearance on the Brekete Family live show. Edwin confirmed earlier reports that the refinery has begun producing petrol, while noting that local oil traders have been importing diesel and aviation fuel, effectively blocking the sale of Dangote’s fuel within Nigeria.

“We have been exporting aviation fuel, we have been producing kerosene, we have been producing diesel, but yesterday, we started the production of PMS. So, that was the last stage. The only thing now left out is petrochemicals,” Edwin said. He added, “The good news for the country is we have started producing PMS from our refinery since yesterday.”

When asked if the newly produced petrol would be sold domestically, Edwin responded, “Well, I explained how there has been a kind of a blockade from lifting our products within the country. The traders have been trying to block [it], and so now we have been exporting our petroleum products. PMS, we are ready to pump in as much as possible to the country. But if the traders or NNPC are not buying the product, obviously, we will end up exporting the PMS as we are doing with the aviation jet and diesel.”

Edwin expressed frustration over the unexpected challenges faced by the refinery as it began operations, pointing out that the initial goal was to add value to Nigeria’s raw materials by refining crude locally rather than exporting it and importing refined products.

“What is happening today? We are struggling to get the crude. We are now importing the crude from the US, we are importing from Brazil, and from other parts of the world. So, the whole philosophy has gone upside down. After all these decades, we are exporting crude, importing products,” he lamented.

Edwin further explained that despite laws governing domestic crude supply obligations—stipulating that no crude can be exported unless local refinery requirements are met—the refinery is struggling to secure adequate crude supplies from within Nigeria. As a result, Dangote Refinery has started constructing four crude tanks, each with a 120 million litre capacity, to store imported crude.

“In fact, if you see the refinery, we are building four new crude tanks, each of the tanks has 120 million litres capacity. We have to construct the tanks because we are not getting the local crude. We import from overseas, which means we should have enough stocks due to the shipping time,” he said.

Edwin also highlighted the refinery’s capacity for local distribution, stating that its gantry can load 2,900 tankers per day, yet less than five per cent of this capacity is being utilised due to low domestic demand.

“Go and see our product gantry, we can load 86 tankers at any given time. We can load 2,900 tankers of petroleum products every day, but we are not even loading five per cent, because those who are interested in the trading business feel that probably this local production is going to affect their established interest, so they are not allowing our products to be sold locally. They are not coming to lift our products. So, what are we doing? We are exporting the products.”

He stressed that while the refinery could survive by importing crude and exporting refined products, this was not the original intention behind its establishment. The refinery was built to enhance local production and supply.

On the quality of the products, Edwin asserted that Dangote Refinery has one of the best laboratories in the world and produces Euro 5 grade fuel, which meets the stringent standards of Europe and the United States. “Our product can be exported to any part of the world, the best in quality, the lowest in sulphur. In terms of pollution, we have no pollution. So, we are producing the best quality products. That is how we are already exporting our product. Our aviation jet fuel has gone to Europe, and we are exporting our diesel. So, the refinery has been successfully launched and producing the products,” he noted.

Edwin concluded by emphasising the company’s commitment to environmental sustainability and energy efficiency, stating, “One of the philosophies of the business is that wherever it is going to operate, the business should be highly environmentally friendly… And the same thing, philosophy, has been adopted here. So, as we start producing, we find that the energy costs are the lowest.”