The Dangote Group has openly criticised the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) for its failure to enforce a key provision of the Petroleum Industry Act (PIA), saying that the NUPRC has not delivered on the allocation of 29 million barrels of crude oil to the Dangote Petroleum Refinery and Petrochemicals.
In a press statement released on Friday by the Group Chief, Branding and Communications Officer, Anthony Chiejina, the management of Dangote expressed frustration over the lack of direct access to crude oil from Nigerian producers, despite a recent allocation announcement.
The NUPRC had earlier stated that it facilitated the allocation of 29 million barrels of crude oil to the Dangote Refinery. However, Dangote Group, in its statement, revealed that they are yet to receive these cargoes. The company thanked the NUPRC for the allocation but pointed out the discrepancy between what has been announced and the actual deliveries.
“We are in receipt of NUPRC’s statement that they have facilitated the allocation of 29 million barrels of crude oil to the Dangote Petroleum Refinery and Petrochemicals. We would like to thank them for this allocation but at the same time let them know that we are yet to receive these cargoes,” said Anthony Chiejina, Group Chief, Branding and Communications Officer of Dangote Group.
This situation comes on the heels of the broader implementation of the Petroleum Industry Act (PIA), which was signed into law in August 2021. The Act aims to overhaul the Nigerian oil and gas industry, with provisions designed to increase transparency, improve efficiency, and attract investment. A key component of the PIA is the requirement for Nigerian refineries to purchase crude directly from domestic producers, bypassing international traders who have long dominated the market.
However, Dangote Group’s statement reveals that this provision is not being effectively enforced. “Aside from the term supply we bilaterally negotiated with NNPC, so far NUPRC has only facilitated the purchase of one crude cargo from a domestic producer. The rest of the cargoes we have processed were purchased from international traders,” Chiejina added.
The company’s frustrations appear to be rooted in the NUPRC’s recent admission that it would not be able to enforce the domestic crude supply obligation as specified in the PIA, citing the “sanctity of contracts” as a reason. This has raised concerns about the effectiveness of the PIA and the willingness of regulatory bodies to implement its reforms.
“All we are asking for is for refineries in Nigeria to buy crude directly from the companies that produce it in Nigeria rather than from international middlemen. This is specified in the PIA,” Chiejina stated emphatically.
Ozioma Samuel-Ugwuezi
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