Vitol, Trafigura, and BP Plc have emerged as the dominant buyers of refined products from Dangote Refinery, securing 75% of its output, according to a recent report.
The trio have accounted for the vast majority of the plant’s shipments since flows began ratcheting up around the middle of this year, according to data from Precise Intelligence, a new oil-and-gas trading analytics firm based in Geneva.
This is coming on the heel of the recent back and forth with local marketers on petrol prices and supply issues, with Aliko Dangote, the CEO of the refinery, insisting that the refinery has about 500 million liters of petrol in its storage.
The report indicates that Vitol and Trafigura, international oil traders, are the dominant buyers of Dangote refinery’s petroleum products.
Vitol is a global energy and commodities trading company in Rotterdam, Netherlands. It has its operations worldwide, with major offices in Geneva, Houston, London, and Singapore.
On its part, Trafigura has its headquarters in Singapore but operates in over 50 countries.
Meanwhile, BP Plc is a British oil trading company and operates across various countries.
Precise figures show that automotive gasoil — diesel — is the biggest cargo type being lifted, followed by fuel oil. Together, they account for more than 60% of what’s being collected from the plant.
Other products include petrol and jet fuel.
Dispute Between Dangote and Local Marketers
Dangote refinery began selling petrol to the Nigerian market in September, initially selling to the Nigerian National Petroleum Corporation (NNPC) Limited as the primary off-taker.
- Meanwhile, NNPC, who argued that they could no longer get the cost following the complete deregulation of the downstream sector by the federal government, quit being the sole taker from Dangote.
- This move allows local marketers such as the Independent Petroleum Marketers Association of Nigeria (IPMAN) to deal directly with the 650,000 petrochemical plant.
- Moreover, the engagement between both parties (Dangote refinery and local marketers) has not been a smooth one.
In an earlier statement, Aliko Dangote hinted that the marketers may be bypassing his refinery for imported petrol from foreign countries, arguing that the fuel scarcity in the country can be easily resolved if the marketers just come and purchase from him.
“We are producers. I have a refinery. I’m not in the business of retail. If I’m in the business of retail, then you can hold me responsible. But what I’m saying is that the retailers should please come forward and pick. If they don’t come forward and pick, what do you want me to do? There is nothing I can do,” Dangote told journalists in Abuja.
- Meanwhile, some of the marketers argued that purchasing petrol from Dangote might be a little bit more expensive than imported petrol.
- On their part, the management of Dangote said that is not the case as they sell premium fuel for a relatively low price, lower than the price prescribed by NNPC following deregulation of the sector.
In addition, the spokesperson of the refinery, Anthony Chiejina, alleged that only those who want to import dirty fuel into the country will sell at a lower rate than what Dangote is selling.
What You Should Know
Dangote refinery, the largest single train refinery in both Africa and Europe, was a $20 billion investment by Africa’s richest man, Aliko Dangote.
- The refinery, which currently refines about 420,000 barrels per day, has the capacity to refine 650,000 bpd upon full operation.
- By that capacity, it can not only meet the energy needs of Nigeria, which consumes about 40 million liters of petrol per day.
It can also supply to other African nations such as Ghana, Togo, and Benin Republic, making the continent energy-sufficient.
