In his address to the Senate Ad-Hoc Committee investigating alleged economic sabotage in Nigeria’s petroleum industry, Mele Kyari, the Group Chief Executive Officer of the Nigerian National Petroleum Company (NNPC) Limited, emphasized the importance of self-sufficiency in the refining business – urging Dangote Refinery to secure its own feedstock.
Speaking at the National Assembly, Kyari clarified NNPC’s stance and operational principles, asserting that the company has adhered to all legal guidelines and should not be implicated in claims of economic sabotage.
Kyari outlined the fundamental principles of the refining business, stating, “Refining business is a straightforward business. You must secure (a source for) your feedstock and you must find a market.”
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This statement, directed at the Dangote Refinery, underlines the rule for refineries to independently secure their crude oil supply and establish a market for their products.
Kyari stressed that NNPC has not engaged in any actions to undermine domestic refineries. “We have done nothing to sabotage any domestic refinery,” he asserted, reinforcing that the law mandates a willing buyer and a willing seller in domestic crude oil supply obligations.
Background: Dangote Refinery’s Faceoff with NMDPRA
The backdrop to these statements includes recent revelations by Aliko Dangote, Chairman of the Dangote Group, who disclosed that international oil companies in Nigeria were reluctant to supply crude oil to the Dangote Refinery. These companies prefer to export crude oil for foreign exchange earnings, posing a challenge to the refinery’s operations.
Dangote also alleged that some people in the NNPC have blending plants in Malta, and are importing substandard petrol into Nigeria.
The allegation created tension between Dangote Refinery and the NNPC, resulting in an uproar from the Nigerian public.
The tension between Dangote Refinery and the NNPC is part of a larger backdrop of disputes involving the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA). This faceoff escalated last month when Dangote Refinery accused the NMDPRA of obstructing the refinery’s operations.
In response, the NMDPRA accused the Dangote Group of refining substandard oil products. This back-and-forth escalated into a public spat, with both sides exchanging accusations of sabotage and regulatory non-compliance.
Addressing the Allegations
Responding to allegations of economic sabotage and the importation of sub-standard products, Kyari categorically denied NNPC’s involvement. He clarified that regulatory agencies are responsible for ensuring the quality of imported products, and NNPC complies with these regulations.
Kyari also supported calls for live broadcasts of the Committee’s sessions to ensure transparency and prevent misinformation, pledging full cooperation with the investigation.
He highlighted significant challenges facing Nigeria’s petroleum sector, including crude oil theft, pipeline vandalism, and insufficient investment in the upstream sector. Despite these challenges, he noted that Nigeria possesses the infrastructure to produce two million barrels of crude oil per day. However, the NNPC boss acknowledged that addressing these issues is crucial for maximizing the sector’s potential and ensuring the stability and growth of Nigeria’s economy.
Economic Sabotage: Count Us Out
Kyari firmly stated that NNPC has not breached any enabling laws guiding its dealings with partners and, hence should be excluded from any claims of economic sabotage. He reiterated the basic principles of the refining business, underscoring the importance of securing a feedstock source and finding a market, which applies universally to any refinery.
On the alleged importation of sub-standard products into the country, Kyari said the NNPC Limited has nothing to do with that, as the relevant regulatory agencies would not allow any sub-standard product into the country by law.
He affirmed NNPC Limited’s loyalty and commitment to Nigeria, asserting that the company remains in line with the provisions of the Petroleum Industry Act (PIA), the Company & Allied Matters Act (CAMA), and other enabling laws and regulations governing the nation’s energy industry.
“We are faithful, loyal, and committed to the progress and development of this country. It is our duty to protect the overall interest of this great nation. We are not in breach of any rules,” he affirmed, emphasizing NNPC’s role in ensuring the stability and growth of Nigeria’s petroleum industry.