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Dangote Refinery’s Petrol Pricing Shrouded in Secrecy, Say Petrol Retailers

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The Petroleum Products Retail Outlets Association of Nigeria (PETROAN) has expressed concerns over the lack of transparency in the pricing of petrol produced by the Dangote Refinery. The association is calling on the management of the refinery to be more open about its pricing mechanism, which it says has been kept secret since the refinery started operations.

Billy Gillis-Harris, the President of PETROAN, voiced these concerns during an interview on Channels Television. According to Gillis-Harris, petrol retailers, including those in his association, have not been informed of the exact input prices of petrol from Dangote Refinery, making it difficult for them to properly plan their businesses.

In his interview, Gillis-Harris did not mince words. He emphasized that PETROAN and other stakeholders are in the dark regarding how the refinery determines its petrol prices. “As I speak to you this morning, I don’t know what Dangote’s price is all about, and that speaks volumes,” he said. “Retail outlets like us should know the price input from Dangote, but they have kept that shrouded in secrecy up until now.”

His remarks point to a broader issue of transparency in Nigeria’s energy sector. While the Nigerian National Petroleum Company Limited (NNPC) has given a general price template, this template does not break down the specific cost contributions from Dangote Refinery.

PETROAN is urging Dangote Refinery to open up lines of communication and engage more with stakeholders in the petroleum distribution industry. According to Gillis-Harris, such transparency is crucial because the fuel business directly affects millions of Nigerians, from petrol retailers to everyday consumers.

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“Even if it’s a private business, there should be some level of business transparency,” Gillis-Harris said. “We are proud that we have such a facility operating in Nigeria, but we need to start seeing the works. We need to know what is going on, especially with something as important as fuel pricing.”

He added that without knowing the refinery’s pricing structure, it is difficult to tell whether Dangote Refinery has increased or reduced its petrol prices. This uncertainty, according to him, makes it hard for retail outlet owners to make informed decisions, particularly when it comes to pricing at the pump.

The Dangote Refinery is a significant part of Nigeria’s petroleum industry. Owned by Aliko Dangote, one of Africa’s richest men, the refinery is the largest in Africa and is expected to meet Nigeria’s domestic fuel demand while also exporting refined products to other countries. With a capacity to refine 650,000 barrels of crude oil per day, the facility is designed to help reduce Nigeria’s reliance on imported fuel.

However, the concerns raised by PETROAN suggest that despite the refinery’s potential, there are operational issues that need to be addressed, particularly in terms of pricing transparency. The refinery’s pricing of Premium Motor Spirit (PMS), commonly known as petrol, remains a mystery to many stakeholders, even as the refinery has been more open about the prices of other products like diesel.

“I can tell you about their price for diesel because the diesel prices were made known to us. Most of us patronize them for diesel,” Gillis-Harris explained. “But in the case of PMS, I don’t have any information.”

Fuel pricing in Nigeria has always been a hot-button issue, affecting everything from the cost of transportation to the price of goods in the market. With the removal of fuel subsidies earlier this year, petrol prices have soared, leaving many Nigerians struggling to cope with the increased cost of living.

For a refinery as significant as Dangote’s, transparency in pricing is vital not just for the petrol retailers but for the entire country. Knowing the input costs and understanding the factors behind petrol pricing could help ease some of the frustrations felt by the public.

Gillis-Harris stressed that Nigerians deserve to know what is happening with fuel pricing, especially when a facility like Dangote Refinery, which is expected to have a positive impact on fuel availability and prices, is involved.

PETROAN’s president emphasized the need for collaboration between Dangote Refinery and other stakeholders in the oil and gas sector. He urged Dangote to open up communication channels and engage with petrol retailers to ensure that everyone is on the same page when it comes to pricing.

“We will encourage Dangote to open up the space of communication, talk to stakeholders, and get valuable inputs from everyone,” Gillis-Harris said. “It’s a business that involves Nigerians, retail outlet owners like us, different consumers, so there should be some level of business transparency.”

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His call for collaboration is not just for the benefit of petrol retailers but also for the broader Nigerian economy. Fuel is a critical resource, and any disruptions or confusion in its pricing can have far-reaching consequences for the country’s economic stability.

The Dangote Refinery is seen as a game-changer in Nigeria’s oil and gas sector. For decades, Nigeria has struggled with refining its own crude oil, relying heavily on imports to meet domestic fuel demand. This reliance on imports has led to fluctuations in fuel prices, especially when global oil prices rise.

The commissioning of the Dangote Refinery earlier this year was seen as a significant step toward energy self-sufficiency. The refinery’s capacity to produce petrol, diesel, and other refined products locally means that Nigeria can reduce its dependence on foreign imports and stabilize fuel prices in the long term.

However, without transparency and collaboration with stakeholders like PETROAN, the potential benefits of the refinery could be undermined by confusion and mistrust.

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