A period of heightened tensions between the Dangote Group and other key players in the oil industry has reportedly come to a close, thanks to a high-level intervention led by Heineken Lokpobiri, Nigeria’s Minister of State for Petroleum Resources.
The minister convened a meeting on Monday to tame the escalating spat that has seen allegations and counter-allegations flying around.
“I convened a high-level meeting with top executives from Dangote Group, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), and the Nigerian National Petroleum Corporation Limited (NNPC) to address the ongoing issues surrounding the Dangote Refinery,” Lokpobiri stated in a press release on X, formerly known as Twitter.
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Present at this critical meeting were Aliko Dangote, President of Dangote Group, Farouk Ahmed, Authority Chief Executive of the NMDPRA, Gbenga Komolafe, Chief Executive Officer of the NUPRC, and Mele Kyari, Group Chief Executive Officer of NNPC.
The discussions were focused on finding sustainable solutions to the challenges faced by the Dangote Refinery. All parties demonstrated a strong commitment to collaborative and proactive problem-solving.
“The meeting was a collaborative effort to find sustainable solutions to the challenges affecting the refinery. All parties involved demonstrated a strong commitment to proactive problem-solving and expressed their gratitude for the leadership and timely intervention provided,” he said.
The gathering is seen as a pivotal moment in addressing the refinery’s issues, highlighting the government’s commitment to the sector’s stability and progress. Lokpobiri underscored the importance of cooperation and synergy among all stakeholders to ensure the success and optimal performance of the oil and gas sector, which is crucial for Nigeria’s economic growth and energy security.
Background of the Dispute
The spat between Dangote and the federal government escalated last week, marked by allegations and counter-allegations from both sides.
Last month, Devakumar Edwin, Vice President of Oil and Gas at Dangote Group, accused the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) of allowing the import of substandard fuel into the country. This led to a strong rebuttal from NMDPRA’s Chief, Farouk Ahmed, who alleged that diesel from Dangote’s refinery and others had high sulfur levels, rendering it inferior to imported fuel.
“The AGO quality in terms of sulphur is the lowest as far as West Africa’s requirement of 50 parts per million (ppm). Dangote refinery, as well as some major refineries like Waltersmith refinery, produce between 650 ppm to 1,200 ppm. So, in terms of quality, their quality is much more inferior to the imported quality,” Ahmed claimed.
Ahmed added that the refinery remains in the pre-commissioning stage and has not yet received its operating license.
“We haven’t been licensed yet,” Ahmed stated, adding that the refinery is still in its preliminary stage.
“I think we have about 45% completion,” he said.
Recently, Aliko Dangote, Africa’s richest man, suggested that some individuals within the NNPC and certain traders are running a blending plant in Europe, hinting at vested interests behind the recent attacks on his refinery.
“Some of the NNPC people and some of the traders have opened a blending plant somewhere off Malta. We all know these areas, we know what they’re doing. It’s not that we don’t know… I’m not scared, I will fight head-on,” Dangote said.
Dangote has also accused certain quarters of distributing substandard petroleum products, which have been damaging vehicles in Nigeria.
“Most of you have problems with your vehicles because of the bad fuel that we are importing,” he said.
However, the resolution of tensions between Dangote Group and NMDPRA is a positive step towards stabilizing the oil and gas sector, which remains vital for Nigeria’s economic growth and energy security.
Many Nigerians are counting on Dangote’s refinery to provide cheaper petroleum products, which is expected to alleviate the high cost of transportation. The 650,000 bpd capacity refinery, once fully operational, is expected to reduce the country’s dependence on imported refined petroleum products, thus lowering costs and improving supply reliability.
Thus, the hope is that this mediation will bring a permanent end to the dispute, allowing Dangote Group, the regulators, and other players in the oil sector, to focus on their shared goal of advancing Nigeria’s energy sector.