Alhaji Aliko Dangote, chairman and president of the Dangote Group, owners of the new 650,000 barrels per day crude oil refinery in Lagos, yesterday argued that the decision by the NNPC Limited to reduce its stake in the facility from 20 per cent to 7.2 per cent was a huge mistake.
Speaking during a Bloomberg Television interview in New York, Dangote further disclosed that although he has two oil blocks which are set to begin production in October, he will likely not invest heavily in Nigeria’s upstream sector.
Besides, the billionaire businessman noted that the NNPC has pledged to supply the refinery with 390,000 bpd barrels in October, stressing that the expected settlement of transactions in Naira would reduce pressure on the local currency by as much as 40 per cent.
But on the reduction of its interest in the refinery, the NNPC defended the decision, stressing that it planned to invest more in cleaner energy sources like Compressed Natural Gas (CNG).
Dangote stated that there was no room for further negotiation on the matter, pointing out that although it was a good deal, the NNPC bungled it. Dangote stressed that 90 per cent of the world did not give the refinery the chance to survive, noting that he felt satisfied personally with the progress made so far.
He explained that the company already had loans of about $2.4 billion while the refinery was still trying to get a suitable location because of the complex issues involved, reiterating that everything was built from scratch. Dangote affirmed that it remains the sole decision of the FG to end a decades-long subsidy on fuel but noted that in the coming days, the government will come up with a robust agreement with the refinery on how to move on with product supply going forward.
With the recent directive by President Bola Tinubu to NNPC to sell crude oil in naira and for Dangote refinery to sell petrol in the local currency, Dangote stated that the naira will soon begin to stabilize.
According to him, with the commencement of petrol refining in Nigeria, the real consumption of the product, which he characterized as ‘guesswork’, will soon be unravelled. He stated that negotiations were still on with the government on pricing, expressing confidence in the ability of the minister of finance and the FIRS boss, Zaach Adedeji, to thrash out all pending issues.
