By Ayomide Otitojun
Dangote Petroleum Refinery and Petrochemicals (DPRP) has raised concerns over the continued issuance of petroleum product import licences, saying rising imports of Premium Motor Spirit (PMS) are creating uncertainty in the domestic market despite its capacity to meet and exceed Nigeria’s fuel requirements.
The refinery’s management said it remains committed to Nigeria’s energy security and uninterrupted fuel supply but warned that increasing volumes of imported PMS are making domestic demand forecasting, production planning and inventory management more difficult.
According to market data available to the refinery, imported PMS accounted for approximately 43 per cent of fuel supplied to the Nigerian market in July. The figure, it said, raises questions about the need for continued large-scale imports amid substantial domestic refining capacity.
Since commencing operations, Dangote Refinery said it has maintained adequate inventories and reserved product volumes to guarantee steady supplies to the Nigerian market. It said this has involved significant investments in storage facilities, logistics and working capital.
However, the refinery said limited transparency over expected import volumes has made it increasingly difficult to determine how much fuel should be produced and held in stock.
“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 company stated.
Dangote Refinery said products that are not immediately absorbed by the domestic market must be evacuated through exports to regional and international markets.
It stressed that the increase in export volumes is not due to an inability to meet local demand but is instead a response to excess inventory resulting from uncertainty in the domestic market.
According to the refinery, exporting surplus products helps prevent unnecessary storage and financing costs while ensuring that its operations remain commercially sustainable.
DPRP further said its growing exports should not be interpreted as a withdrawal from the Nigerian market or a lack of commitment to domestic supply.
Rather, the company said the exports reflect a market where imported products continue to compete with locally refined petroleum products despite the availability of sufficient domestic refining capacity.
The refinery reiterated that it remains “ready, willing and able” to meet and surpass Nigeria’s petroleum product requirements, adding that it continues to invest in ensuring reliable fuel supplies nationwide.
It also warned that any supply shortfalls resulting from market distortions caused by excessive imports and difficulties in forecasting domestic demand should not be attributed to Dangote Refinery, which it said has consistently demonstrated its capacity and commitment to serving the Nigerian market.
The company called for greater transparency, improved market coordination and policies that support local refining, arguing that such measures would strengthen Nigeria’s energy security, conserve foreign exchange and maximise the economic benefits of investments in domestic refining capacity.
