Dangote, marketers bicker over importation of dirty fuels

Fuel depot

By Stanley Onyeka, Lagos

Oil marketers have denied importing ‘dirty refined products’ into the country as alleged by the management of Dangote Refinery.

Indeed, the marketers accuse Dangote Refinery of trying to enforce market monopoly in downstream operations, which they promised will be met with “stiff resistance”.

In a statement titled: “No Marketer or Depot Owner Imports Dirty Fuels as Claimed by Dangote Refinery,” the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN), emphatically denied that any of its members indulges in such malpractices.

Over this weekend, Vice President, Oil and Gas, Dangote Industries Limited (DIL), Devakumar Edwin, accused International Oil Companies (IOCs) operating in Nigeria of frustrating operations at the Dangote Oil Refinery and Petrochemicals.

He also indicted the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), of granting licenses indiscriminately to marketers to import ‘dirty refined products’ into the country.

Responding, DAPPMAN insisted that “the information from the Dangote Refinery Management is laced with inaccuracies.”

Defending its members, the marketers claimed not to import “any fuel with specification that is outside of the regulation other than what is currently approved by the Nigerian Midstream and Downstream Regulatory Authority (NMDPRA).”

Toxic fuels

Mr. Edwin, speaking with a group of journalists, said: “It appears that the objective of the IOCs is to ensure that Nigeria remains a country which exports crude oil and imports refined petroleum products.

“They, (IOCs), are keen on exporting the raw materials to their home countries, creating employment and wealth for their countries, adding to their GDP, and dumping the expensive refined products into Nigeria – thus making us to be dependent on imported products.

“It is the same strategy the multinationals have been adopting in every commodity, making Nigeria and Sub-Saharan Africa to be facing unemployment and poverty, while they create wealth for themselves at our expense. “This is exploitation – pure and simple.

“Unfortunately, the country is also playing into their hands by continuing to issue import licences, at the expense of our economy and at the cost of the health of the Nigerians who are exposed to carcinogenic products.

“In spite of the fact that we are producing and bringing out diesel into the market, complying with ECOWAS regulations and standards, licences are being issued, in large quantities to traders who are buying the extremely high sulphur diesel from Russia and dumping it in the Nigerian market.

“Since the US, EU and UK imposed a Price Cap Scheme from 5th February 2023 on Russian petroleum products, a large number of vessels are waiting near Togo with Russian ultra-high sulphur diesel and, they are being purchased and dumped into the Nigerian market.

“In fact, some of the European countries were so alarmed about the carcinogenic effect of the extra high sulphur diesel being dumped into the Nigerian market that countries like Belgium and the Netherlands imposed a ban on such fuel being exported from its country, into West Africa, recently.”

…all downstream operators and their activities must be in tandem with the provisions of the Petroleum Industry Act 2021, which abhors ‘monopoly’ of any sort.

Dangote diesel high in sulphur content

But DAPPMAN recalls that “between February and May 2024, the NMDPRA had allowed automotive gas oil (AGO, popularly called diesel) imports with maximum sulphur content of 200/ppm.

“However, this was followed by another move, by the regulator, to fast forward the country target date of the implementation of the 50/ppm sulphur limitation on PMS and AGO imports, from 31st December 2024 to 1st June 2024.”

This move, they said, limited all marketers and depots to source AGO from the Dangote Refinery “even though the latter was yet to install its desulphurization equipment as the sulphur in its blends of AGO presently exceed 50/ppm.

“This again was resisted by DAPPMAN in its letter to the NMDPRA which was dated 10th June 2024 to warn and alert the regulator not to ‘inadvertently promote and introduce a monopoly into the sector.

The Association also noted that “the downstream regulatory authority, (NMDPRA), in the very recent past had initially objected to offtakes by our daughter vessels from import mother vessels, via ship-to-ship operations which usually take place offshore Lome, a move which was vehemently protested and resisted by downstream operators and has been rescinded.

Market monopoly

While the Dangote Refinery insists it has more than enough capacity to meet local and export needs for diesel, the marketers vow to meet every attempt at introducing a Dangote Refinery monopoly into the downstream with stiff resistance.

DAPPMAN continued: “Despite its most recent production of AGO with sulphur contents reported at 1200/ppm, it is baffling to us that the Management of Dangote Industries (including the Dangote Refinery), who are very much aware of these facts, could claim that the NMDPRA has been granting licenses indiscriminately to marketers to import ‘dirty refined products’ into the country.

“Their current blend of AGO, with reported sulphur contents of 1200/ppm is technically classified as ‘dirty fuel’ and grossly in excess of the 200/ppm imported by any marketer or depot owner.  

“Dangote Refinery as a business entity is free to adopt any model that suits its management however its current practice of cheaper bulk sales prices to international buyers at the detriment of Nigerian buyers calls to question their patriotism to the country.

“Several Nigerian marketers had in recent past been offered Dangote Refinery cargoes by international trading firms at rates that are very much lower than what they were directly offered by Dangote Refinery, and this will not be in the interest of the Nigerian fuel end-user.”  

The marketers further acknowledged that “there is no doubt that the success of Dangote Refinery will be a thing of pride to the nation, but all downstream operators and their activities must be in tandem with the provisions of the Petroleum Industry Act 2021, which abhors ‘monopoly’ of any sort.”

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