Former President Olusegun Obasanjo has stated that those profiting from the lucrative industry of fuel importation will make steps to sabotage the Dangote Petroleum Refinery.
Obasanjo made this statement in response to charges by the President of the Dangote Group, Alhaji Aliko Dangote, that some’mafias’ were attempting to sabotage the $20 billion refinery.
This comes as it was reported on Monday that the multibillion-dollar refinery and other domestic refineries were failed to purchase crude oil in naira as per President Bola Tinubu’s directive to the Nigerian National Petroleum Company Limited.
In an interview with the Financial Times, the former President said the Dangote refinery should inspire both Nigerians and non-Nigerians.
“If Aliko’s refinery investment succeeds, both Nigerians and non-Nigerians will be encouraged to invest in Nigeria.
“If those who are selling or supplying refined products for Nigeria feel that they will lose the lucrative opportunity, they will also make every effort to get him frustrated,” the president said.
Officials from the Dangote Group recently complained that multinational oil companies were frustrating the refinery by refusing to supply crude or selling it at a premium of up to $4 above the customary price.
They also accused the Nigerian Midstream and Downstream Regulatory Authority of purposefully issuing licenses to individuals to import filthy fuel.
The regulator dismissed this, claiming Dangote diesel was inferior to imported fuel.
Farouk Ahmed, Chief Executive of the NMDPRA, also indicated that the country would not stop importing fuel in order to avoid the Dangote Group’s monopoly.
Obasanjo went on to say that Nigeria committed a fatal mistake by focussing solely on oil, ignoring gas and agriculture.
“I think we made a very, very fatal mistake. We placed all of our eggs in one basket of oil. We even neglected petrol. We were flaring gas, which is an extremely valuable commodity.
“We ignored agriculture, which should have been the centrepiece of our economic development,” Obasanjo stated. He recalled how he persuaded Shell to run the country’s refineries but the International Oil Company refused, saying there was too much corruption in the sector.
“When I was President, I urged Shell to take equity in our refineries and run them for us. They declined. They said that our refineries had not been sufficiently maintained.
“We brought amateurs instead of professionals. They claimed there is too much corruption in the way our refinery is managed and maintained. “And they didn’t want to get involved in such a mess,” he added.
He enquired how many times they had promised to fix the refineries. And at what price?
“The problems with the government refineries have never gone away. They’ve even increased. So, if you have a situation like that and it is not resolved, you are not going anywhere.”
The former President also questioned President Bola Tinubu’s approach to removing fuel subsidies, claiming that the current administration should have first examined the suffering that subsidy removal would cause people and how to alleviate it.
“There is a lot of work to be done. Not just get up one morning and announce that you’ve removed the subsidies. The subsidy we abolished is still in effect due to inflation. “It has returned,” the former President emphasised.
He said there must be investor confidence in Nigeria, adding, “You have to go from transactional economy to transformational economy.”
Obasanjo expressed concern about the restlessness of Nigerian youth due to unemployment, stating, “Our youth are restive. And they are restive because they have no skill, empowerment, and employment. We are all sitting on a keg of gunpowder. And my prayer is that we will do the right thing before it’s too late.”
Crude in Naira
On Monday, it was also reported that the Dangote refinery and other local refineries in Nigeria have failed to begin purchasing crude oil from NNPC in naira, as mandated by President Tinubu.
According to the Crude Oil Refiners Association of Nigeria, individual refiners have addressed letters to NNPC requesting crude, but no response has yet been received.
The Federal Executive Council has approved Tinubu’s proposal to sell crude to the Dangote refinery and other prospective refineries in naira.
The FEC approved that 450,000 barrels intended for domestic use be given in naira to Nigerian refineries, with the Dangote plant serving as a pilot. The exchange rate will remain fixed for the duration of this transaction.
However, over a week after the statement, the refiners claimed they had not heard from the NNPC.
Eche Idoko, the Publicity Secretary of the Crude Oil Refiners Association of Nigeria, stated that the Nigerian Midstream and Downstream Petroleum Authority is expected to initiate the process.
“We have not started buying crude from the NNPC. Individual members have already written to them (NNPC), and they have multiple requests from these refineries to consider.
“Typically, we would expect our regulator, in this instance, the NMDPRA, to kick start the process by calling for a meeting of all parties to discuss the framework for such supply or have NNPC respond to the various letters to it by the refineries requesting for crude,” Idoko said.
The CORAN spokesperson had previously indicated that supplying crude oil to local refineries in naira would lower the cost of petrol and boost the naira against the dollar.
Idoko praised Tinubu for listening to indigenous refiners’ concerns, but suggested that an executive order be issued about the new regulation.
The crude oil refiners also requested a meeting with the economic team to negotiate a rate that would benefit the Nigerian market.
“Yes, we will see a recovery in petrol prices if the President’s directive is enforced. Mind you, the pronouncement alone is insufficient. It must be enforced by law, either through an executive order or the incorporation of a new guideline, so that crude producers are obligated to sell to us in naira,” Idoko remarked.
Dangote Refinery and other local refiners have complained about the problems connected with obtaining crude oil for their units. Dangote Group management recently stated that the IOCs were still impeding crude supplies to the refinery with a capacity of 650,000 barrels.
In a statement, the organisation said that the IOCs persisted on supplying crude oil to its refinery via their overseas agents, claiming that the local price of crude will continue to rise because the trading arms offer cargoes at $2 to $4 per barrel, which is higher than the NUPRC official pricing.
The group also said that international oil companies appear to prioritise Asian countries when selling crude produced in Nigeria.
A senior official at the Dangote refinery, who asked not to be identified owing to a lack of authority to talk on the subject, revealed that the plant had yet to begin purchasing crude in naira from NNPC.
When our journalist contacted NNPC spokesperson Olufemi Soneye, he did not react to questions about the incident.