Dangote: Allow only licensed refiners to import fuel

The right to import petroleum products into the country should be assigned only to companies with active refining licences, the Dangote Group has recommended.

The firm asserted that this would encourage investment in local refining of petroleum products.

The company, currently building a 650,000-barrels-per-day refinery in Lagos, urged that this should be part of the Petroleum Industry Bill.

The Chief Strategy Officer, Dangote Group, Aliyu Suleiman, in a presentation during a visit by members of the National Assembly’s Joint committee on PIB to the project site, gave the position.

 He said, “Nigeria is exceptional in being a major oil producer with near zero refining capacity.

“Though the Dangote Refinery will help address this, there could be periods when petroleum products may need to be imported, such as when the refinery is undergoing turnaround maintenance or if demand grows to exceed capacity.”

The company recommended that the backward integration policy should be applied in the downstream petroleum sector to encourage investment in local refining.

“To support this, licence to import any product shortfalls should be assigned only to companies with active refining licences. Import volume to be allocated between participants based on their respective production in the preceding quarter. Such import will be done under the DSDP scheme,” he said.

According to Dangote Group, fuel imports into Nigeria are of very low quality, and this has harmful effect on health.

“It also impacts performance and durability of vehicles, especially high performance cars. ECOWAS members (including Nigeria) signed a declaration in February 2020 to adopt cleaner fuels,” it said.

The company suggested that to safeguard the health of Nigerians, imported petroleum products must conform to the Afri-5 specification (50 ppm sulphur) in line with the ECOWAS declaration of February 2020 on adoption of the Afri-Fuels Roadmap.

The company described the provision in the PIB for third-party access to pipelines as a source of concern.