Oil and gas expert, Ademola Adigun, has stated that Nigeria’s crude oil alone can not meet Dangote’s refinery demands.
Adigun said this in an interview with ARISE NEWS on Monday night about the oil and gas sector.
Adigun further explained the limitations of Nigeria’s crude supply in meeting the demands of the Dangote refinery. “Dangote refinery is so large that even Nigeria’s total ownership output can not supply it. Every crude in Nigeria doesn’t belong to the country. There are investors who have invested in different mining contracts in Nigeria who take their crude from what is produced globally. We don’t have enough crude to give. That’s why oil theft is a big issue.”
Elaborating on the refinery’s operational strategy, he highlighted the flexibility in sourcing crude oil. “Dangote needs crude, which it can get from anywhere. The refinery is built to accommodate different crude, and that isn’t the problem.”
He pointed out the financial constraints faced by Nigeria’s National Petroleum Corporation, saying, “We borrowed the $1.58 billion money for the investment in Dangote. People forget that NNPC is broke.”
Adigun praised the efforts and investments of Dangote, stating, “Dangote is doing something marvellous by investing a lot of money in the refinery in Nigeria. When these things happen, they will do what is called a stress test, which this is part. It is part of those times where we check laws, test laws, investment climate and what it leads to is that we develop new learning and new methods so we don’t repeat mistakes.”
Addressing common misconceptions in the sector, he clarified the factors influencing petrol prices. “First of all, it is not about getting crude from Nigeria or America that determines the price of petrol. That’s one of the problems we have. Nigerians have an entitlement sense and mentality across.
Crude is not the only factor that determines the cost of a product. Products are determined by two factors, which are the international price of the product and exchange rate. It doesn’t matter where the crude is from, transport costs are negligible.”
Regarding the role of the Petroleum Minister, Adigun affirmed that the ministry is actively involved.
Emphasising the market orientation of the Dangote refinery, he noted, “Dangote is an export refinery. Whenever it produces anything, Nigeria will buy from it in dollars. It’s no different from us importing.”
Adigun addressed the challenges of public perception and clarity in the oil and gas sector, stating, “One of the problems we have is sentiments and misinformation. We should dissociate people and their personality from issues. Whatever is happening is misunderstanding, wrong assumptions, and technical issues.”
NANCY MBAMALU
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