Key highlights
- IPMAN says Nigerians will buy locally, refine and sell locally, we will no longer need forex to import products but rather, it will sell refined products and earn us forex.
- Refinery to address fuel shortages and price hikes in the country,
- The CBN Governor also stated that the refinery will save over $25 billion in foreign exchange savings for Nigeria.
Nigeria’s Independent Petroleum Marketers Association of Nigeria (IPMAN) says that the launch of the Dangote refinery would address Nigeria’s fuel import and scarcity issues.
This was disclosed by Mr Chinedu Anyaso, Chairman of IPMAN, Enugu Community depot in charge of Anambra, Ebonyi and Enugu states, in an in Awka on Monday.
The Dangote Refinery was officially commissioned yesterday, with the group founder, Aliko Dangote stating that products would begin rollout from next month.
Welcome Development
The Independent Petroleum Marketers Association of Nigeria (IPMAN) said that this is a breath of fresh air to Nigeria’s energy industry as it will address fuel shortages and price hikes in the country.
The Dangote refinery which cost over $18 billion to complete with 650, 000 barrel production capacity would lead to an initial increase in pump price according to IPMAN, but would decrease in the long run.
- “They will buy locally, refine and sell locally, we will no longer need forex to import products but rather, it will sell refined products and earn us forex.
- “It is a welcome development,” he said.
Petroleum Act
The IPMAN chairman urged the Federal Government to revive its four refineries and optimise their production to support what Dangote would produce, to ensure full sufficiency of the products, praising the administration of President Muhammadu Buhari for signing the Petroleum Industry Act (PIA) which encouraged private sector investment in the oil and gas industry.
UPMAN also cautioned against monopoly, saying it would leave Nigerians worse off if left at the mercy of one supplier.
- “We need more players to come, the market is there, so there should be competition, the Federal Government should ensure a monopoly is not created.
- “The PIA which this administration graciously signed encourages private sector involvement, people who have the capacity should be encouraged to follow the Dangote example.
IPMAN also called for the renovation of all moribund depots including that of Enugu for easy distribution of petroleum products as it would reduce challenges of sourcing products and drive down prices.
In case you missed it
The President of the Central Bank of Nigeria, Godwin Emefiele disclosed that the commencement of operations at the Dangote refinery would be a major boon for Nigeria’s FX reserves, as it would save $25 billion in Nigeria’s FX needs, due to an end to energy imports and provide $10 billion in exports.
Emefiele said the take-off comes with economic benefits, generating over 135 thousand permanent jobs and also 12MW of electricity, as the project gives us significant savings and eases the fiscal burden.
- “30% of Nigeria’s FX requirements went to fuel imports, it is instructive to note, that according to the balance of payments, it doubled from 8.4$ billion in 2017 to $23.3 billion at the end of 2022,
- “Average annual costs of petroleum imports could breach $30 billion by 2027 if we continue to rely on imports
- “The refinery will save over $25 billion in foreign exchange savings, and benefit an extra $10 billion through exports of refined products.
