NUPRC: We’ll ensure IOCs supply sufficient crude oil to Dangote Refinery

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has announced plans to mandate International Oil Companies (IOCs) to supply crude oil to the Dangote Refinery amid their reluctance to sell the product locally.

The spokesperson for the NUPRC, Mrs. Olaide Shonola, made this statement on June 4, 2024, in response to claims by the Chairman of the Dangote Group, Aliko Dangote, that international oil companies were unwilling to sell crude to the refinery.

Dangote’s interview with American Cable News expressed frustration over the IOCs’ preference for exporting crude oil for foreign exchange rather than selling it locally.

He acknowledged the Nigerian National Petroleum Company Limited’s (NNPC Ltd) efforts to supply feedstock but highlighted the IOCs’ resistance to changing their export-oriented business models.

Dangote, Africa’s richest man, criticized Africa’s reliance on exporting raw materials and importing finished goods, describing it as a hindrance to the continent’s growth.

Shonola, however, emphasized the commission’s intervention in ensuring that domestic refineries, including the Dangote refinery, receive adequate crude oil supplies.

She stated: “We will mandate the IOCs to sell to the Dangote refinery, with clear directives that this must be done. We have been intervening and will continue to do so. As the regulator, we can mandate actions through clear directives.”

However, Shonola refrained from discussing potential sanctions for non-compliance, reiterating that the NUPRC’s role is to issue regulatory directives.

“The NNPC Ltd. is doing its best, but some of the IOCs are struggling to give us crude. Everybody is used to exporting, and nobody wants to stop,” Dangote said.

Dangote also noted that his refinery, with a capacity of 650,000 barrels per day, would significantly impact Nigeria’s crude oil landscape by reducing the number of ships transporting crude oil in and out of Africa.

He stated that the refinery would handle approximately 21 million barrels of crude oil per month, significantly reducing CO2 emissions associated with shipping.

In April, the NUPRC introduced a regulation requiring oil producers to prioritize domestic refineries for crude oil supply before fulfilling foreign demands.

However, compliance among IOCs appears lacking, prompting the NUPRC’s latest mandate.