In a fresh move aimed at boosting the availability of petroleum products supply in the country, the Nigerian National Petroleum Company Ltd has approved the allocation of 19 cargoes of crude oil to the Dangote Refinery and Petrochemical Company, NewsNGR can report.
Sources told NewsNGR that the NNPC Ltd has approved the allocation of six cargoes of crude oil to Dangote Refinery for September while 13 additional cargoes would be released in October.
The move by the NNPC Ltd is in line with the resolution of the Federal Executive Council on July 29th which approved the sale of crude oil to Dangote Refinery and other local Refineries in Naira instead of Dollars.
During the meeting, President Bola Tinubu had extended an offer of support to the Dangote Refinery by proposing that NNPC Ltd sells crude to the refinery in Naira, providing a valuable lifeline
.
In order to maintain the stability of fuel prices and the exchange rate between the dollar and the Naira, NewsNGR reported that the Federal Executive Council accepted a suggestion put forward by Tinubu during the meeting.
The proposal involves selling crude oil to Dangote Refinery and other new Refineries in Naira.
The exchange rate will remain constant throughout this transaction.
Based on the approval, NewsNGR had reported that only the volume that is equivalent to domestic consumption would be billed in Naira.
The recent announcement that the national oil company will become the exclusive buyer of petrol from the Dangote refinery could provide relief to NNPC Ltd which is spending huge amount on importation of petroleum products.
If the Dangote refinery exclusively supplies NNPC, it would significantly lower importation and logistics costs, allowing local marketers to purchase petrol from NNPC at a reduced price.
This arrangement could also address the persistent fuel scarcity that has plagued the country for over a month, with NNPC making progress to address the situation.
Meanwhile, the Dangote Refinery has said it had yet to fix the price of petrol lifted from as it is yet to finalize the contract with NNPC Ltd.
It said in a statement signed by the Group Chief Branding and Communication, Anthony Chiejina that the PMS market is strictly regulated, which is known to all oil marketers and stakeholders in the sector.
Given this, the company noted that it cannot determine, fix, or influence the product price, which falls under the purview of relevant government authorities.