N1,000/Litre Petrol Possible If Coastal Logistics Persist – Dangote

The Dangote Petroleum Refinery has issued a warning that Nigerian fuel prices could approach N1,000 per litre if the country continues to rely on coastal supply of petroleum products.

In order to guarantee pricing consistency for customers, the company emphasized that its preferred gantry loading technique is still the most effective and economical.

In a statement on Thursday, the refinery clarified that ongoing investments in vital infrastructure, such as a “world-class gantry facility” with 91 loading bays that can load up to 2,900 tankers every day, back its viewpoint.

The plant, which is open around-the-clock, is capable of evacuating more than 50 million liters of premium motor spirit, 14 million liters of diesel, and other refined goods every day.

The refinery emphasized that gantry evacuation eliminates additional expenditures, even though it acknowledged that coastline loading is an alternative where logistics necessitate it.

“By eliminating port fees, maritime levies, and vessel-related expenses that do not contribute value to end users, direct gantry evacuation helps to optimize costs, improve distribution efficiency, and support price stability,” the business said.

Additionally, it made clear that merchants are allowed to select the evacuation method of their choice, with PMS and other sophisticated products offered at affordable costs that are comparable.

However, depending too much on coastal delivery, especially inside Lagos, could result in needless expenses that have a significant impact on fuel prices, consumer welfare, and general economic well-being. The refinery stated, “We believe that coastal logistics can add about N75 per litre to the cost of gasoline, which, if passed on to consumers, would push the pump price of PMS close to N1,000 per litre.”

Based on Nigeria’s typical daily consumption of around 50 million liters of PMS and 14 million liters of diesel, the business also calculated that continued reliance on coastal logistics might result in an additional yearly cost of about N1.75 trillion.

It cautioned that Nigerian consumers or producers will eventually be responsible for this expense.

Calls for coordinated nationwide pipeline infrastructure investment were also rekindled by the Dangote refinery. Functional pipes connecting refineries to depots, it was suggested, would boost national energy security, increase supply reliability, and drastically reduce distribution costs.

The refinery responded to accusations that it imports refined petroleum products by calling them false.

We only import intermediate feedstock in accordance with international industry standards, even if our Residue Fluid Catalytic Cracking Unit is now undergoing maintenance. Anyone with solid proof of the importation of a finished product is challenged to provide it to the relevant regulatory bodies. Interests looking to defend a sustained reliance on fuel imports frequently make such assertions, the refinery said.

The business claimed that since operations started, diesel costs have decreased from approximately N1,700 per litre to between N980 and N990, while PMS prices have decreased from approximately N1,250 per litre to between N839 and N900, illustrating the advantages of domestic refining.

The naira, which is currently trading at roughly N1,385 to the dollar, has strengthened due to the dramatic decrease in gasoline imports, the alleviation of foreign exchange pressures, and the enhanced local supply, it was said.

In closing, the refinery urged legislators, regulators, and marketers to support distribution and logistics choices that safeguard consumers, support national economic interests, and maintain the long-term advantages of domestic refining.