Adigun: Nigeria Bears No Responsibility For Dangote Refinery’s Crude Oil Needs

Adigun: Nigeria Bears No Responsibility For Dangote Refinery’s Crude Oil Needs

Oil and gas expert Ademola Adigun has weighed in on the controversy surrounding Dangote Refinery’s access to crude oil in Nigeria, emphasizing that it is not Nigeria’s responsibility to supply crude oil to the refinery……. CONTINUE READING 

Dangote Industries Limited has consistently accused International Oil Companies (IOCs) of hindering the supply of crude oil to its 650,000 barrels per day refinery. Devakumar Edwin, Vice President of Dangote Industries Limited, reiterated these claims, stating that IOCs were selling crude at prices higher than Nigeria’s official rate and preferentially exporting to Asian countries.

Speaking on Channels Television’s Sunrise Daily, Adigun, former team leader of Facility for Oil Sector Transformation, clarified that securing a supply chain is the refinery’s responsibility before commencing operations.

“I’ve heard this argument repeatedly: is it our duty to provide crude for Dangote Refinery owned by Dangote? If you’re a land developer, would it be my responsibility to provide you land?” Adigun questioned.

He pointed out that like any business, Dangote Refinery must ensure its supply chain security independently of Nigeria’s involvement.

Regarding fuel scarcity, Adigun attributed it to disruptions in the product’s supply chain and described the Nigerian National Petroleum Company (NNPCL) as constrained by government policies, particularly as the importer of last resort.

Adigun also discussed the Domestic Crude Supply Obligation (DCSO) under the Petroleum Industry Act (PIA), emphasizing that local refineries are prioritized for crude supply. However, he clarified that Dangote Refinery, despite being geographically located in Nigeria, does not technically fall under the DCSO due to its location in an export processing zone.

He concluded by noting that transactions with Dangote Refinery involve dollar payments as its products are predominantly for export, not the Nigerian market.