The President and Chief Executive of Dangote Group, Alhaji Aliko Dangote, has revealed that the price of petrol produced by his 650,000 barrels per day refinery in Ibeju-Lekki, Lagos State, is about 15 percent cheaper than the one imported into the country by the Nigerian National Petroleum Corporation Limited (NNPCL).
The richest African and blackman in the world made the revelation in a 26-minute interview with Bloomberg Television in New York on Monday monitored by Business Hallmark.
Speaking on the pricing disagreement between his refinery and the NNPCL after the rollout of gasoline from the mammoth plant on September 15, 2024, Dangote said NNPCL bought its current stock from him at a cheaper price than its imported fuel, but gave a uniform price for all products.
“There wasn’t really a disagreement, per se. NNPC bought from us on the 15th of September at the international price, they also imported about 800,000 metric tons of gasoline.
“So the one that they bought from us actually is cheaper than the one they are importing.
“And so when they announced our price, the guy (NNPCL’s spokesperson, Olufemi Soneye), I don’t know whether he was authorized. The price he quoted wasn’t really the real price. What they have announced is most likely what it cost them, including profit and other expenses.
“And then the other one is the one that they imported. But the people (Nigerians) don’t know how much they spend in terms of imports, but their importation is almost, maybe about 15 per cent more expensive than ours, you know.
“So what they are supposed to do is to sell at a basket price, or if they want to remove subsidy, they can announce that they will remove subsidy, which is okay, everybody, you know, will adjust it”, Dangote explained.
While confirming ownership of two oil blocks in the upstream sector with an expected production date of October 2024, the Kano-born billionaire advised the Federal Government to completely end the fuel subsidy regime, arguing that the removal would help determine the actual petrol consumption in the country.
“Subsidy is a very sensitive issue. Once you are subsidising something, people will bloat the price and then the government will end up paying what they are not supposed to be paying. It is the right time to get rid of subsidies.
“But this refinery will resolve a lot of issues out there, you know, it will show the real consumption of Nigeria, because, you know, nobody can tell you (what we consume). Some people say 60 million litres of gasoline per day.
“Some say it’s less. But right now, if you look at it by us producing, everything can be counted. So everything can be accounted for, particularly for most of the trucks or ships that will come to load from us.
“We are going to put a tracker on them to be sure they are going to take the oil within Nigeria, and that, I think, can help the government save quite a lot of money.
“The removal of subsidies is totally dependent on the government, not on us. We cannot change the price, but I think the government will have to give up something for something. So I think at the end of the day, this subsidy will have to go.”
Speaking further, Aliko Dangote disclosed that refined petroleum products from his refinery will help ease pressures on the naira.
Based on available information, Nigeria spends $25 billion on average annually on fuel importation, especially diesel, petrol, kerosene and aviation fuel.
“Petroleum products consume about 40 per cent of our foreign exchange, but fuel from our refinery can actually stabilize the naira.
“You know, it’s like you have 40 per cent of demand been taken out, so that can actually stabilize the naira and even if they subsidise, they would know what they are paying for”, Dangote added.