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Naira-for-Crude: Dangote highlights positive outcomes from initiative

Dangote

In a recent high-level meeting, Aliko Dangote praised the progress made in advancing Nigeria’s crude oil sales and refining initiative, which allows for crude transactions in naira and enables local refiners to sell petroleum products to the Nigerian public.

Dangote reflected on the insights shared by the chairman of the committee overseeing the Naira crude initiative, affirming that the meeting underscored key developments, including the use of a market-determined exchange rate and crude pricing.

Following directives from the President, the Nigerian National Petroleum Corporation (NNPC) and private marketers will purchase crude on equal terms, with Afreximbank stepping in as a settlement intermediary between entities like Dangote’s refinery, other local refiners, and NNPC.

This setup will not only simplify transactions but also stabilize the supply chain within the new pricing model.

Dangote expressed optimism about the broader industrial impact, noting that this initiative will revitalize various sectors, from plastics and LPG to aviation, while bolstering the supply of refined products domestically. Currently ramping up production, the new Dangote refinery processes around 420,000 barrels per day, with full capacity still ahead.

“Once all refineries, including NNPC’s, are operational,” Dangote added, “Nigeria will be positioned to become one of the largest exporters of petroleum products.” He highlighted the President’s commitment to supporting domestic industries and ensuring that all refineries continue functioning to meet local demand and attract further investment.

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Concluding, Dangote described the meeting as “extremely positive,” reinforcing hopes for a stable supply of locally refined products and a strengthened Nigerian economy.

Dangote on Fuel Queues: “We’re Ready to Supply, but Retailers Must Collect”

Amid ongoing fuel queues across the country, Aliko Dangote has assured Nigerians of his refinery’s capability to meet fuel demands. With 500 million liters in storage, he stated that Nigeria could maintain supply for more than 12 days without imports, provided retailers pick up available stock. At full capacity, Dangote confirmed, his refinery could produce over 30 million liters daily to meet consumption estimates of 30-32 million liters, with ramped-up production expected soon.

Addressing the disparity between supply availability and street-level shortages, Dangote clarified that while his refinery produces fuel, it does not engage in retail. “If retailers come forward to collect fuel, the queues will disappear,” he stated, urging NNPC and marketers to increase collection efforts. Noting the financial cost of holding vast reserves, he emphasized that his facility stands ready to pump fuel daily and alleviate shortages as long as distribution chains remain active.

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Ihesiulo Grace

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