In a move that has been described as ‘unprecedented,’ the Dangote Petroleum Refinery on Tuesday announced a further reduction of the price of diesel from N1,200 to N1,000 per litre.
Members of the Independent Petroleum Marketers Association of Nigeria had a few weeks ago said that local oil marketers set the price at N1,225 naira per litre for diesel after securing a bulk purchase agreement, prior to adding their mark-up.
It came after a group Executive at Dangote, Devakumar Edwin, confirmed that the company has begun distributing diesel and jet fuel to the local market.
“We have substantial quantities. Products are being evacuated both by sea and road. Ships are lining up one after another to load diesel and aviation jet fuel.
“Ships load a minimum of 26 million litres, though we try to push for 37 million litres vessels, for ease of operations,” Edwin said.
In a note from the company, it stated that before now, it had reduced the price from the market rate of N1,600 to N1,200, about a 30 percent crash, but that even that price has been further reduced.
The Dangote refinery added that the latest development is expected to significantly impact the overall economy which depends partly on diesel to power businesses.
“While rolling out the products, the refinery supplied at a substantially reduced price of N1,200 per litre three weeks ago, representing over 30 per cent reduction from the previous market price of about N1,600 per litre.
“This significant reduction in the price of diesel, at Dangote Petroleum Refinery, is expected to positively affect all the spheres of the economy and ultimately reduce the high inflation rate in the country,” it said in the note.
Dangote oil refinery began supplying the Nigerian domestic market with petroleum products such as diesel and aviation jet fuel Tuesday, according to sources familiar with the matter.
The Dangote refinery, positioned on a peninsula near Lagos’ commercial centre, represents Africa’s largest refinery project, completed after many postponements and financed by Aliko Dangote, Africa’s wealthiest man, with an investment of about $19 billion.
With the capacity to process up to 650,000 barrels per day, the refinery is set to be the largest in both Africa and Europe once it attains full operational capacity, expected later this year.
The Dangote refinery is expected to significantly reduce Nigeria’s dependence on imported petroleum products as the nation currently imports nearly all of its fuels due to its insufficient refining capability.
Emmanuel Addeh
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