The war of prices between the Dangote Petroleum Refinery and petroleum marketers escalated on Sunday as the refinery alerted Nigerians about the existence of a new depot hired by an unnamed international trading company for the sole purpose of blending substandard petroleum products in Nigeria.
The Group Chief Branding and Communications Officer of Dangote Group, Anthony Chiejina, dropped the bombshell in a statement on Sunday.
Chiejina maintained that if allowed, the depot would constitute a major threat to the nation’s refining industry and public safety, as it would be blending and selling low-quality products to unsuspecting Nigerians, thereby increase their economic adversity.
The statement was in response to statements credited to the Independent Petroleum Marketers Association of Nigeria, IPMAN, and other associations that the price of imported fuel is cheaper than what obtains in Dangote refinery.
But Dangote refinery, in its response, strongly maintained that any marketer claiming to sell PMS at a lower price than the current price is importing substandard products in connivance with international traders who are hellbent on flooding the country with low-quality products.
The petroleum marketers had, recently, revealed that the Dangote Petroleum Refinery was selling Premium Motor Spirit, otherwise known as petrol, at between N1,015 and N1,028/litre depending on the quantity being purchased.
They threatened to import the products and sell below the Dangote refinery price as well as that of the Nigerian National Petroleum Company Limited, NNPCL.
Dangote refinery punctured that too, disclosing that while NNPC set its prices at N971 for ship-based sales and N990 for truck-based sales, it set its price at N960 for ship sales, keeping the truck rate at N990
Denied the claims by the marketers, Dangote Refinery released the statement, alleging connivance with an international firm to blend and dump products into the market to compete with Dangote’s high quality.
The statement reads: “We had lately refrained from engaging in media fights but we are constrained to respond to the recent misinformation being circulated by IPMAN, PETROAN, and other associations.
“Both organisations claim that they can import PMS at lower prices than what is being sold by the Dangote refinery. We benchmark our prices against international prices and we believe our prices are competitive relative to the price of imports.
“If anyone claims they can land PMS at a price cheaper than what we are selling, then they are importing substandard products and conniving with international traders to dump low-quality products into the country, without concern for the health of Nigerians or the longevity of their vehicles.
“At the same time, an international trading company has recently hired a depot facility next to the Dangote Refinery, with the objective of using it to blend substandard products that will be dumped into the market to compete with Dangote refinery’s higher quality production.
“This is detrimental to the growth of domestic refining in Nigeria.”
It further noted the complicity of its regulator, the Nigerian Midstream and Downstream Petroleum Regulatory Authority, in detecting substandard products due to the lack of a functional laboratory facility.
“Unfortunately, the regulator, NMDPRA does not even have laboratory facilities that can be used to detect substandard products when imported into the country,” Dangote Refinery said.
On its pricing, the $20bn Lekki-based plant announced that it sold petrol at a reduced rate of N960 per litre for supply via ships and N990 per litre for supply via trucks following the recent deregulation of the sector.
It noted that while NNPC had set its prices at N971 for ship-based sales and N990 for truck-based sales, the refinery opted to set its price at N960 for ship sales, keeping the truck rate at N990.
“Post deregulation, NNPC set the pace by selling PMS to domestic marketers at N971 per litre for sale into ships and at N990 for sale into trucks. This set the benchmark for our pricing and we have even gone lower to sell at N960 per litre for sale into ships while maintaining N990 per litre for sale into trucks.
“In good faith, and in the interest of the country, we commenced sales at these prices without clarity on the exchange rate that we will use to pay for the crude purchased,” it stated.
Chiejina emphasised that there was nothing wrong with the Federal Government protecting its local industries, as is the practice in other climes.
“We should point out that it is not unusual for countries to protect their domestic industries in order to provide jobs and grow the economy,” Chiejina said. “For example, the US and Europe have had to impose high tariffs on EVs and microchips in order to protect their domestic industries.
“While we continue with our determination to provide affordable, good quality, domestically refined petroleum products in Nigeria, we call on the public to disregard the deliberate disinformation being circulated by agents of people who prefer for us to continue to export jobs and import poverty.”