PMS: Dangote Speaks On Possible Price Cut
The Chairman of Dangote Group, Aliko Dangote at a recent Afreximbank Annual Meetings and AfriCaribbean Trade & Investment Forum in Nassau, The Bahamas gave insights into the production process in his refinery and how it could lead to a reduction in petrol price.
Dangote who disclosed that he refines $20 billion 650,000 barrels per day in his Lagos-based refinery said the price of fuel will crash as it reduced the price of diesel in Nigeria.
Dangote, when asked about the possibility of a reduction of the pump price of petrol from his refinery which currently sells at an average of N700 per liter details how the price of diesel fell from 1,700 to N1,200 when his diesel flooded the Nigerian market
He, however, noted that his refinery currently has 4.78 billion liters of storage capacity for refined petroleum products.
He said, “The issue of gasoline is certainly a different issue. That one is being dealt with by the government. But let me give you an example. In diesel, which the industries, transporters and everybody consume; when we first started, it was N1,700, and the dollar conversion was about N1,200 then. Immediately when we started, within two weeks we brought down the price to N1,000. We took it from N1,700 to N1,200 and from N1,200 to N1,700, we have given more than a 60 percent drop in price.
“With the currency now back up to about N1,500 per dollar, the price is still below N1,200. That’s a big improvement, from N1,700 to N1,200. And the diesel is available, we are not living from hand to mouth anymore,” Dangote replied when asked about a possible petrol price cut.
“The country doesn’t have strategic reserves in terms of petrol, which is very dangerous. But in our plant now, when you came, we had only 4.78 billion liters of various tankage capacity. But right now, we’re adding another 600 million.
“So effectively, as we go forward, the refinery will be the strategic reserve of the country in terms of petroleum products,” he noted.
In a further discourse, Dangote affirmed that international oil companies refused to sell crude oil to his refinery simply because they don’ want him to succeed.
“And I think that is the process that we’re now really going through. But the truth is that, yes, the country, the sub-region, and also the continent, of sub-Saharan Africa, need this refinery. So, you expect them to fight through non-supply of crude, non-purchase of the product, but I think it’s all temporary. We’ll get there,” he added.
Recall, Dangote Refinery turned to the US for 24 million barrels of crude supply monthly.
Consequently, the refinery shifted the date to commence supply of fuel to July 10–15, 2024, from June.
Follow us for more.
Author
