Business

Experts laud FEC approval of NNPC’s acquisition of 20% stake in Dangote Refinery

Published

3 years ago

August 5, 2021

Experts laud FEC approval of NNPC’s acquisition of 20% stake in Dangote Refinery

Dangote-Some economists and oil and gas expert have backed the Federal Executive Council’s (FEC) approval of the acquisition of 20 percent minority stakes by the Nigerian National Petroleum Corporation (NNPC) in the Dangote Petroleum and Petrochemical Refinery.

They made their views known in separate interviews with the News Agency of Nigeria (NAN) on Thursday in Lagos.

NAN reports that Chief Timipre Sylva, Minister of State for Petroleum Resources, had announced the approval after the virtual FEC meeting presided over by Vice President Yemi Osinbajo on Wednesday at the Presidential Villa, Abuja.

Sylva had said the acquisition was in the sum of $2.76 billion.

Reacting to the development, Prof. Chris Onalo, Registrar and Chief Executive Officer, Institute of Credit Administration, said oil and gas remain the major source of revenue for the government which requires massive investment in the sector.

Onalo said the Dangote Group had taken the bull by the horns to make a huge investment that was needed to jumpstart the industry and therefore needed the support of all and sundry including the government.

He said the investment from the NNPC was to support the billions already committed by Dangote Group in the world’s largest single-train refinery.

“The refinery is an expression of massive confidence in the oil and gas economy of this country.

“It shows that the sector can take Nigeria out of economic woes. I think it is a welcome development and those of us who are in the public domain can’t wait too long to see that happening.

“So, I will say kudos to the Dangote Group for its investment drive across the economy of this country,”Onalo said.

He added that the NNPC’S support to the refinery and others coming on stream soon would increase investors’ confidence in the sector thereby attracting the more investments.

Also, Mr Muda Yusuf, an economist and immediate-past Director General of the Lagos Chamber of Commerce and Industry (LCCI), said the Dangote Refinery was of strategic national importance.

“My views have always been that even though this is a private sector project, it makes both commercial and nationalistic sense for NNPC to express a interest in it.

“This project has a good prospect to put an end to fuel importation and the associated leakages of public funds while also preserving our foreign exchange reserves,” Yusuf said.

He said the refinery would also stimulate the economy in areas such as job creation, agriculture and exportation of petrochemicals to other countries.

Yusuf said: “The proposal by NNPC to take 20 per cent equity stake in the Dangote Refinery is a move in the right direction. The reality is that the Dangote refinery is a project of significant and strategic national importance, even though it is promoted by the private sector.

“Taking a stake in the project also makes a great deal of business sense, especially given how far the project execution has gone and our heavy dependence on importation of petroleum products.

“It also makes both commercial and nationalistic sense for NNPC to express an interest in a project that has a good prospect to put an end to fuel importation and the associated leakages of public funds.

“It would also ensure the preservation of our foreign reserves as we currently spend billions of dollars annually on importation of petroleum products.”

He said in addition to the several multiplier effects of the refinery arising from related spin off industries like petrochemicals, fertilizer plants resonates well with the country’s aspiration for self reliance and backward integration.

He added that the export prospects of the Dangote Refinery were also quite bright.

Yusuf stated that another exciting thing about the investment proposition by the NNPC was that the national oil company would be a minority shareholder and would therefore not take responsibility for the management of the refinery.

He noted that the undoing of Nigeria’s public enterprises had been the quality of management, saying as a country, Nigeria had paid a huge price for this in the form of inefficiency, corruption, wastages and many more.

The LCCI DG further said that the model being proposed with the Dangote refinery was similar in a way to the Nigeria Liquefied Natural Gas (NLNG) Limited’s model, which according to him, remains the best example of how government funds should be invested.

“It is a model that shields the investment from interference by politicians and bureaucrats.

“This proposition is much better than the decision to commit scarce public funds to the rehabilitation of decrepit government-owned refineries,” he added.

Similarly, Mr. Wilson Opuwei, Chief Executive Officer, Dateline Energy Services Limited, said the approval was a step in the right direction for the country.

“It makes sense for the NNPC to invest in ventures that will bring returns to the company. Every business needs good investments and this is what the NNPC is doing with the Dangote Refinery.

He said that the refinery will ensure energy security as the Refinery is capable of meeting Nigeria’s gasoline requirements while generating revenue in hard currency from export of diesel, jet fuel, polypropylene among many others.

Chief Operations Officer, Dangote Oil Refining Company, Mr Giuseppe Surace told the marketers that the refinery has been designed to process a variety of light and medium grades of crude, including petrol and diesel as well as jet fuel and polypropylene.

He said the refinery was billed to produce up to 50 million litres of petrol and 15 million litres of diesel a day, roughly 10.4 million tonnes of the product, 4.6 million tonnes of diesel, and 4 million tonnes of jet fuel yearly.

According to him, this is in addition to having a fertiliser plant, which would utilise the refinery by-products as raw materials.

He disclosed that the refinery which has recorded 90 per cent completion, was expected to address the challenge of petroleum product importation in Nigeria and other African countries.

He said, “If you look at the overall percentage completion, we have achieved good, considerable progress. But that overall includes engineering and design, which is 100 per cent over.

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Business

Oil marketers counter Dangote

Published

6 hours ago

November 5, 2024

Sahara Weekly

Oil marketers counter Dangote over allegation of substandard product importation

The Depots and Petroleum Products Marketers Association of Nigeria (DAPPMAN) has countered the claim by Dangote Refinery that any oil importers landing petrol at a price cheaper than what the refinery is selling are importing substandard products and conniving with international traders to dump low quality products into Nigeria.

The refinery had made the claim on Sunday.

In a statement yesterday, DAPPMAN’s Executive Secretary, Olufemi Adewole, said none of its members was engaging in activities that could shortchange Nigerian fuel users by conniving with anyone to bring in low quality product into the country.

“We’ve said this for the umpteenth time, and it bears repeating, those in the downstream sector business of petroleum products trade are patriotic Nigerians who will not shortchange Nigerian citizens for filthy lucre. Our members are in this business to add value to the businesses of their fellow Nigerians and not to defraud them.

“Prices of products in the international market are dynamic as they’re dictated by prevailing circumstances at every given situation. We calculate our landing costs based on the dynamics of market forces, and the templates are always in the public domain. To claim that if the landing cost of imported product happens to be lower than that of the refinery indicates importation of low quality product is not only preposterous, but also fallacious. In any case, the management of the refinery has, until now, kept its cost and prices close to its chest and put it away from public scrutiny. “

“This type of submission, targeted at projecting our members negatively before the public, cannot help the management’s desire to have oil marketers patronise its products. What will ensure such patronage is transparency, fair play, and readiness to compete with others, including foreign refineries, on an even keel and on a level playing field.”

Adewole said the disclosure by the refinery’s management that the facility has a huge stock of 500 million litres fuel reserve came to its members as news.

“We were surprised because we believe that if the refinery has such huge stock, it’s the marketers that should be put in the know first.

‘Secondly, it was even more surprising given that the news came about the time the refinery was working on rationing what each marketer could pick from the refinery. If they had such huge stock, how is it then that they’re rationing what marketers could buy?

“On all these developments in the industry, the position of our members is very clear: we’ve always played by the rules, and we’ll continue to play by the rules. We’ll not be tired of advocating for a level playing field and a highly competitive and transparent sector that’s devoid of arm twisting and devoid of any form of dominant tendencies,” he said.

Similarly, the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) said it had concluded plans to import the best quality petroleum product and sell at far cheaper prices.

The association said it was awaiting the NMDPRA to grant it import licence, saying it “has successfully incorporated a strategic business unit called PETROL.”

Its spokesman, Joseph Obele, said PETROAN had concluded plans with her foreign refinery counterparts and financial partners to import the best quality of PMS and “then sell far less than the present selling rate of PMS in Nigeria.”

He said the allegations that PETROAN would import inferior products and that an international company was trying to establish a PMS blending plant in Lagos “are all strategies for Dangote Refinery to push others out of the market…”

Also, Pinnacle Oil and Gas Limited, in a statement by its Chief Executive Officer, Bob Dickerman, denied blending substandard petroleum products.

Business

Why Protesters demanded Kyari’s resignation

Published

6 hours ago

November 5, 2024

Sahara Weekly

Why Protesters demanded Kyari’s resignation

Scores of youths stormed the headquarters of the Nigerian National Petroleum Company Limited on Monday, demanding the immediate resignation of the Group Chief Executive Officer of the company, Mele Kyari.

The protesters, led by some Civil Society Organisations, described Kyari’s leadership as incompetent, citing skyrocketing fuel prices, endless fuel queues, and economic hardship in Nigeria.

The protesters carrying placards with different inscriptions such as “we demand the immediate resignation of Kyari”, among others, said the leadership of the NNPCL boss has failed.

The aggrieved youths led by Abdullahi Bilal of the (Two Million Man March Against Oil Scam Cabal) and Barrister Napoleon Otache and Olayemi Isaac from Citizens and Economic Freedom Rights Activists in Nigeria demanded immediate action to address what they described as failed leadership in managing the country’s oil sector.

Central to the protests were grievances over skyrocketing fuel prices and the never-ending queues, which they argued have driven inflation and plunged millions of Nigerians into poverty.

They also decried the importation of adulterated fuel, which they said is a corrupt practice that harms citizens by damaging vehicles and businesses.

They demanded an immediate halt to these imports and accountability for those responsible, questioning how substandard fuel continues to enter the country despite quality control assurances.

Additionally, the group criticized the unfulfilled promise of the Dangote refinery to resolve Nigeria’s fuel crisis, expressing frustration over the billions of dollars spent on refinery development and refurbishing existing facilities.

They argued that despite these investments, fuel shortages persist, leaving Nigeria reliant on costly imports even as an oil-producing nation.

They urged President Bola Tinubu to intervene by overhauling leadership in the oil sector, enforcing greater accountability, and putting citizens’ needs first. The protesters vowed to continue mobilizing until their demands for reform and transparency are met.

Speaking to journalists during the mass demonstration, Abdullahi Bilal said, “The Two Million Man March stands as a united voice for every citizen who has been betrayed by a system that continues to enrich a few at the expense of many.

“Today, we call for the immediate resignation of the current leadership in the country’s oil sector. Their management has failed Nigerians.

“Under their watch, we have seen fuel prices skyrocket without consultation or consideration of the devastating impact on the people. We have endured fuel scarcity while substandard, adulterated fuel is imported, causing further hardship.

“We demand the complete removal of the fraudulent fuel subsidy regime that has only served to enrich a select few. Full deregulation is necessary to introduce transparency, competition, and fairness to our oil sector.”

On their part, Otache and Isaac, insisted, “This act of economic sabotage has led to endless fuel queues, skyrocketing fuel prices, and unprecedented disruptions in the daily lives of Nigerians.

“We demand an immediate end to fuel queues, transparency, and accountability from all involved parties. We want to know how substandard fuel continues to enter the country despite assurances of quality control.”

On July 7, 2019, former President Mohammadu Buhari appointed Kyari as the 19th GMD of NNPC, but with the passage of the Petroleum Industry Act, his current portfolio is without recourse to previous employment ranks in the company.

NNPCL reacts

Reacting, the NNPCL spokesperson, Femi Soneye, said the protestors lack understanding of the sector.

He explained that contrary to their agitation, the GCEO ensured Nigerians had access to fuel at N620 per litre for over a year, even when the landing cost was above N1,100.

Responding via a chat, Soneye said, “Unfortunately, they lack understanding of the sector. If they were informed, they would know that the GCEO is not responsible for the fuel price increase; in fact, he ensured Nigerians had access to fuel at N620 per litre for over a year, even when the landing cost was above N1,100.”

Business

Renewed Hope Agenda and Impacts in Aviation* By Mary Odoma

Published

8 hours ago

November 5, 2024

Sahara Weekly

Renewed Hope Agenda and Impacts in Aviation

By Mary Odoma

President Bola Tinubu’s knack for selecting top talent is unparalleled. In his quest to build a prosperous Nigeria, he’s assembled an exceptional team. By leveraging their expertise, experience, and strategic insight, he’s fostering national stability, economic growth, and a sustainable future.

His latest win is in Aviation and Aerospace Development, where he’s appointed a fearless and straightforward leader, Festus Keyamo, SAN. Keyamo’s commitment to excellence makes him an ideal fit. President Tinubu’s vision for Nigeria is taking shape, and his leadership choices are truly commendable.

A dedicated, charismatic and impactful lawyer, the dynamic and astute developer is a terror to mischief makers and enemies of progress. A tough and forceful personality who is determined with an ultimate goal to change Nigeria.

Appointed on 21st August 2023 as the helmsman of the Ministry, Keyamo has been unwavering in his drive for positive transformation, reforming the sector and bringing about enduring positive impact in a transparent manner.

His Ministry has the core mandate of regulating air travel and aviation services in the country. It is also responsible for overseeing air transportation, air development, maintenance, provision of aviation infrastructural services and other needs.

A very patriotic Nigerian, Chief Festus has several achievements, in line with the Renewed Hope Aviation Roadmap approved by President Tinubu to his credit.

In a steadfast commitment towards revitalizing the nation’s aviation sector, Mr Keyamo was able to ensure the approval of the concession of the Nnamdi Azikiwe International Airport (NAIA), Abuja and Mallam Aminu Kano International Airport (MAKIA), Kano Airports. This is in line with the initiation of the Nigerian Airport Concession Strategy.

Also, in line with the Federal Ministry of Aviation Roadmap, Chief Keyamo initiated the signing of an MoU with the Nile University for the take-off of African Aviation and Aerospace University (AU). This milestone achievement of the Minister aims to integrate and create an avenue for the training, research and development of ready middle-class manpower for the sector.

Equally, under his watch, the pragmatic leader led the Ministry into partnership with the ICRC and also a collaboration with the IFC on infrastructural development. This partnership is to both develop and implement a comprehensive and durable framework that will meet the infrastructural needs of the sector over a long period.

Through Keyamo’s congruence and dynamism, the BASA arrangement is another revolutionary innovation aimed at ensuring the operationalization of direct flights between Nigeria and Brazil.

Keyamo’s motivation and altruistic devotion to having a functional aviation and aerospace sector also moved him to upgrade the Muhammadu Buhari, Airport, Maiduguri to the standard of an international airport. This airport is ready to commence full operation on January 1, 2025

In the area of staff motivation, retirees of the Ministry now have no cause for alarm as their interest is covered. Recently, the Ministry honoured 24 retirees drawn from the lowest rung to the highest. It is in a bid to acknowledge those who have contributed immensely to the growth and development of the sector as Nation-builders.

His prompt response to issues including distress reveals an empathetic personality and someone who is very much alive to his responsibilities. Recently, while reacting to the accident involving a helicopter on the 24th October 2024, Mr Keyamo, immediately upon receiving the distress call, activated protocols aimed at search and rescue operations, mandating all relevant bodies to do everything humanly possible to ensure the safety of the passengers on board the ill-fated vehicle.

The Minister was also actively involved with all the relevant agencies towards ensuring a coordinated response. His active and physical involvement led to the minimization of casualties.

In a show of collaboration and solidarity, the Hon. Minister travelled to far away Marrakesh, Morrocco, to give support to the 2024 International Transport Workers’ Federation (ITF) congress. His presence was to underpin the importance the federal government attaches to the role of the transport workers in stabilizing the aviation sector.

Festus Keyamo as the Honourable Minister of Aviation and Aerospace Development is certainly the best thing that has happened to the industry. He has exhibited passion, dedication and selfless forthrightness in the discharge of his duties and a total comprehension of what it takes to carry out his roles. He is well-groomed for the job and his background has helped him greatly towards shaping the positive impact he is making on society.

Today, Festus has proved that a faithful, disciplined, and dedicated Nigerian can stand out of the crowd because he symbolizes what governance is all about. These feats can only be achieved by a man with the right comportment and conduct in the service of humanity and the fatherland.

Deserving of note is that Chief Keyamo, through the foresight of President Tinubu has well-prepared team leaders appointed as heads of the agencies of the Ministry.

The supportive and collaborative roles of the Nigeria College of Aviation Technology, Nigeria Metrological Agency, Nigeria Civil Aviation Authority, Nigeria Airspace Management, the Federal Airports Authority of Nigeria, and the Nigeria Safety Investigation Bureau (NSIB), have brought about those tangible and noticeable volte-face experienced today in the Aviation sector.

With Keyamo at the helm, Nigeria’s aviation sector is experiencing a transformative shift, thanks to President Tinubu’s foresight in appointing well-prepared team leaders. The Nigeria College of Aviation Technology, Nigeria Metrological Agency, and others are working together to bring about tangible change. Keyamo’s dedication, discipline, and commitment to service have improved Nigeria’s image and reformed the aviation and aerospace sectors.

Odoma is the President of New Nigeria Network [NNN[ writing from Abuja.