BREAKING: President Tinubu has extended an offer of support to the Dangote Refinery by proposing that NNPC sells crude to the refinery in Naira, providing a valuable lifeline.
In order to maintain the stability of fuel prices and the exchange rate between the dollar and the Naira, the Federal Executive Council accepted a suggestion put forward by President Tinubu today. The proposal involves selling crude oil to Dangote Refinery and other new refineries in Naira.
The Nigerian President, Bola Ahmed Tinubu has directed the Nigerian National Petroleum Company Limited to sell crude to Dangote Refinery and other upcoming refineries in Naira.
Federal Inland Revenue Service (FIRS) boss Zack Adedeji disclosed after a FEC meeting chaired by President Bola Tinubu in Abuja on Monday.
He said the measure would reduce the strain on the country’s foreign spending and stabilise the pump price of petrol, diesel, and other products in Nigeria.
Adedeji said FEC ordered that the state-owned NNPCL immediately begin the full implementation of the directive to boost local production of refined petroleum products in Nigeria.
The revenue boss also said the Tinubu administration ordered that the sale of refined products from Dangote Refinery to oil marketers and distributors be denominated in naira and not in US dollars.
Dangote Refinery, at the moment, requires 15 cargoes of crude, at a cost of $13.5 billion yearly. NNPC has committed to supply four.
However, the FEC has approved that the 450,000 barrels meant for domestic consumption be offered in Naira to Nigerian refineries, using the Dangote refinery as a pilot.
“Afreximbank and other settlement banks in Nigeria will facilitate the trade between Dangote and NNPC Limited. The game-changing intervention will eliminate the need for international letters of credit, further saving the country of dollar payments.”
Dangote-FG Brawl
Foremost industrialist and owner of Dangote Refinery, Aliko Dangote, had accused the authorities and International Oil Companies of frustrating crude supply to his $20bn facility sited at the Lekki Free Trade Zone near Lagos.
Regulatory authorities would later questioned the quality of petroleum products produced at the Dangote Refinery but the billionaire businessman insisted that the quality of products at his refinery surpassed the ones imported by marketers.
Dangote commenced operations at his behemoth facility located in Lagos last December with 350,000 barrels a day. The refinery hopes to achieve its full capacity of 650,000 barrels per day by the end of the year.
The Dangote Refinery currently needs 15 shipments of crude oil annually, amounting to a total cost of $13.5 billion. NNPC has pledged to provide four of these cargoes.
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