By Opeyemi Adelakun
The Dangote Petroleum Refinery has raised concerns over the continued inflow of imported petrol into Nigeria, saying the development is creating uncertainty for local production and forcing it to reconsider how much fuel it keeps in reserve.
The refinery made the disclosure on Wednesday in a statement, noting that imported Premium Motor Spirit accounted for approximately 43 per cent of fuel supplied to the Nigerian market in July.
According to the company, the development is raising questions about the continued need for large-scale petrol imports at a time when Nigeria has substantial domestic refining capacity.
Dangote Refinery said it remained committed to ensuring energy security and uninterrupted fuel supply but needed clearer information about the volume of imported products entering the country to plan production and inventories effectively.
The refinery specifically called for greater transparency from the regulator regarding petroleum product import licences and the quantities of fuel being brought into the country.
It said the absence of reliable information on imports was making it increasingly difficult to determine appropriate inventory levels.
“Maintaining large stock positions without clear visibility into import volumes imposes substantial carrying costs on the refinery and ultimately undermines efficient market operations,” it stated.
The company said it had consistently maintained sufficient inventories and reserved product volumes since commencing operations to guarantee steady supply to the domestic market.
However, it said holding large quantities of petrol became commercially difficult when imported products continued to enter the market without sufficient visibility on future import volumes.
“As a responsible energy provider, we have always endeavoured to keep adequate reserves to satisfy local demand at all times. However, in an environment where significant volumes of imported PMS continue to enter the market through licences issued by the regulator, and where there is limited visibility on future import volumes, it becomes commercially unsustainable to continue holding excess inventory indefinitely,” the refinery said.
Dangote explained that when surplus products accumulate because domestic demand cannot absorb them as projected, the refinery has to move the excess into regional and international markets.
“Consequently, DPRP’s export volumes have increased in recent months, not because local demand cannot be met, but because excess inventory generated by market uncertainty must be evacuated to avoid unnecessary storage and financing costs,” it noted.
The refinery stressed that its increased export activities should not be interpreted as a withdrawal from the Nigerian market or an inability to supply domestic consumers.
Rather, it described the exports as an operational response to the uncertainty created by imported petrol competing with locally refined products.
Dangote Refinery maintained that it remained capable of meeting and exceeding Nigeria’s petroleum product requirements and was continuing to invest in sustaining reliable fuel supply across the country.
The company also warned against attributing any future supply shortages to its operations if market distortions caused by excessive imports make it difficult for domestic refiners to accurately forecast demand.
It said any such disruption would need to be considered within the broader context of import volumes and market coordination.
The refinery therefore urged the government and industry regulators to improve transparency around import licences and strengthen coordination in the downstream petroleum market.
It also called for policies that would support domestic refining, improve Nigeria’s energy security, conserve foreign exchange and maximise the economic benefits of investments in local refining capacity.
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