Dangote Refinery Will Save Nigerians Petrol Shipping Cost — FG

By mamakay • 2 weeks ago • 4723 views • 488 comments

The federal government has said the upcoming Dangote Refinery would save Nigerian fuel users the cost of shipping petroleum products from the international market into the country.

The 650,000 barrel-per-day capacity refinery currently under construction is expected to commence operation next year.

The federal government has also said it would from October begin converting the cars and generators of Nigerians to run on gas, noting that this would be done free of charge for all Nigerians to cushion the effect of the hike in pump price of petrol.

However, the Organisation of Petroleum Exporting Countries (OPEC) has said full international oil prices recovery may not return to 2019 price levels until about 2022, and this would potentially translate to increase in the prices of refined products.

Speaking yesterday on a live television programme, the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, argued that the existence of the refinery in the country might not significantly reduce the price of petrol because it’s located at the Export Processing Zone in Lagos and so would be selling at the international market price.

She said the only thing Nigeria would not need to spend money on is freight as Nigeria would be saving money meant for shipping refined products into the country.

Ahmed said: “What we are doing is enabling the petroleum sector to actually grow. There have been a number of refineries that have been licensed for several years. None of them was willing to start refining under the regime that we had where fuel was controlled.

“The Dangote refinery is sitting within an Export Processing Zone. So, they are insulated from that. When we buy fuel from Dangote, we will be buying fuel at the international market price. The only savings that we will be making is the savings of freight which is shipping.

“But, we will still have landing cost; labour cost and the marketers will still have to put a margin. These refineries being those that are supposed to have come to operate can now come in because they are assured that when they produce, they can sell at market rate and recover their investments and make some reasonable profits.

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