News
Dangote refinery insists international oil companies are frustrating its crude supply demands
Nasiru Yusuf Ibrahim
The Management of Dangote Industries Limited (DIL) has commended the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) for its various interventions in the oil company’s crude supply requests from International Oil Companies (IOCs), and for publishing the Domestic Crude Supply Obligation (DCSO) guidelines to enshrine transparency in the oil industry.
KANO FOCUS reports that the Vice President, of Oil & Gas, Dangote Industries Limited, Mr. DVG Edwin however said: “If the Domestic Crude Supply Obligation (DCSO) guidelines are diligently implemented, this will ensure that we deal directly with the companies producing the crude oil in Nigeria as stipulated by the PIA.”
Edwin insisted that IOCs operating in Nigeria have consistently frustrated the company’s requests for locally produced crude as feedstock for its refining process.
He highlighted that when cargoes are offered to the oil company by the trading arms, it is sometimes at a $2-$4 (per barrel) premium above the official price set by NUPRC. “As an example, we paid $96.23 per barrel for a cargo of Bonga crude grade in April (excluding transport). The price consisted of $90.15 dated Brent price + $5.08 NNPC premium (NSP) + $1 trader premium. In the same month, we were able to buy WTI at a dated Brent price of $90.15 + $0.93 trader premium including transport. When NNPC subsequently lowered its premium based on market feedback that it was too high, some traders then started asking us for a premium of up to $4m over and above the NSP for a cargo of Bonny Light”
“Data on platforms like Platts and Argus shows that the price offered to us is way higher than the market prices tracked by these platforms. We recently had to escalate this to NUPRC”, Edwin said and urged the regulatory commission to take a second look at the issue of pricing.
Edwin’s response came against the background of a statement by the Chief Executive Officer of NUPRC, Engr. Gbenga Komolafe, in an interview on ARISE News TV said that “it is ‘erroneous’ for one to say that the International Oil Companies (IOCs) are refusing to make crude oil available to domestic refiners, as the Petroleum Industry Act (PIA) has a stipulation that calls for a willing buyer-willing seller relationship.”
Edwin noted that “The NUPRC has been very supportive to the Dangote Refinery as they have intervened several times to help us secure crude supply. However, the NUPRC Chief Executive was probably misquoted by some people hence his statement that IOCs did not refuse to sell to us. To set the records straight, we would like to recap the facts below.
“Aside from Nigerian National Petroleum Corporation Limited (NNPCL), to date, we have only purchased crude directly from one other local producer (Sapetro). All other producers refer us to their international trading arms.
“These international trading arms are non-value adding middlemen who sit abroad and earn margin from crude being produced and consumed in Nigeria. They are not bound by Nigerian laws and do not pay tax in Nigeria on the unjustifiable margin they earn.
“The trading arm of one of the IOCs refused to sell to us directly and asked us to find a middleman who would buy from them and then sell to us at a margin. We dialogued with them for 9 months and in the end, we had to escalate to NUPRC who helped resolve the situation,” Edwin stated.
According to him, “When we entered the market to purchase our crude requirement for August, the international trading arms told us that they had entered their Nigerian cargoes into a Pertamina (the Indonesia National Oil Company) tender, and we had to wait for the tender to conclude to see what is still available.
“This is not the first time. In many cases, particular crude grades we wish to buy are sold to Indian or other Asian refiners even before the cargoes are formally allocated in the curtailment meeting chaired by NUPRC.
“However, we would like to urge NUPRC to take a second look at the issue of pricing. NUPRC has severally asserted that transactions should be on a willing seller / willing buyer basis. The challenge however is that market liquidity (many sellers / many buyers in the market at the same time) is a precondition for this. Where a refinery needs a particular crude grade loading at a particular time then there is typically only one participant on either side of the market.
“It is to avoid the problem of price gouging in an illiquid market that the domestic gas supply obligation specifies volume obligation per producer and a formula for transparently determining pricing. The fact that the domestic crude supply obligation as defined in the PIA has gaps is no reason for wisdom not to prevail”, Edwin stated.
The 2023 Presidential candidate of the New Nigerian Peoples Party (NNPP), Dr. Rabiu Musa Kwankwaso, has debunked reaching a resolution with any individual on the trending defection rumoured to the ruling party or any other political party.
KANO FOCUS reports that Kwankwaso, who considered the recent statement credited to have suggested a particular position as an imagination of falsehood and fragmentation of political mischief against him.
A statement posted on his official X handle @KwankwasoRM, the ex-Governor insisted he has since refrained from commenting on contemporary political events, and will continue to do so for the time being.
In the said false information that went viral, Kwankwaso was quoted to have revealed a meeting with President Bola Tinubu on multiple occasions, urging him to return to the APC fold.
Responding to a statement purportedly signed by one Ibrahim Rabiu, Sen. Kwankwaso insisted he had never signed or authorised any statement to be issued on his behalf.
“My attention has been drawn to a statement purportedly stating my position on the recurring political realignments. I wish to categorically state that such statements are false, unfounded, and products of political mischief.
“I have refrained from commenting on contemporary political events, and I will continue to do so for the time being.”
” I urge the public to only engage statements that come from my public handles and other official sources”. Kwankwaso RM.”
In a releted development, the author of the purported false statement Ibrahim Rabiu has issued a self counter, denouncing the statement as a work of devil.
“I Ibrahim Rabiu, wish to inform the general public that I was never authorised by Sen. Rabiu Kwankwaso to issue and release a statement on his belhalf”
“I therefore wish to tender a public apology to his person with a promise that such childish act will never be repeated in the future, please find a space in your heart to forgive me, I was misled by fake news and agents of misinformation”
The Emir of Kano, Khalifa Muhammad Sunusi II, commended the Adolescent Girls Initiatives for Learning and Empowerment (AGILE) Project for reenrolling over 30,000 adolescent girls and renovating more than 1,300 schools across the state.
KANO FOCUS reports that the Emir made the commendation while reeiving AGILE State Project Implementation Unit (SIPU) who paid him an advocacy visit recently.
Khalifa Muhammadu Sanusi ll
He emphasized the Kano Emirate Council’s commitment to advocating for education and pledged continued support to ensure the enrollment, retention, transition, and completion of girls’ education in Kano.
The Emir also emphasized the importance of collaboration and synergy in implementing policies and programs that foster the development of the state and the nation at large.
AGILE Project Coordinator presenting gift to Emir of Kano
He expressed satisfaction with the AGILE project’s strong monitoring and evaluation framework, particularly in tracking the use of grants and conditional cash transfers.
In his remarks, the Kano State AGILE Coordinator, Malam Mujtapha Aminu said more than 100,000 students are currently enrolled in learning centers across 23 local government areas under the Adolescent Girls’ Initiative for Learning and Empowerment (AGILE) second chance education in Kano.
AGILE PC and Emir of Kano
He said this initiative provides out-of-school adolescent girls an opportunity to complete their secondary education, gain entrepreneurship and life skills.
According to him, the second chance education students undergo literacy, numeracy, and entrepreneurship training across 5,000 learning centers.
Athletes who participated in AGILE WEEK Games
He further explained that after nine months of instruction, the students sit for examinations and are awarded certificates equivalent to the Junior Secondary School Certificate.
“Those who enroll in the advanced literacy program also have the opportunity to sit for national examinations such as NECO and WAEC,” he added.
He said they visited the Emir’andalace to seek blessings and advocate for support to achieve their goals.
AGILE Communications Officer and games officials
The AGILE Project is a World Bank-assisted initiative implemented through Federal and State Ministries of Education, aimed at improving secondary education opportunities for adolescent girls in Nigeria.
The gale of defection from opposition political parties intensifies as two members of the opposition New Nigeria Peoples Party (NNPP), Abdullahi Sani Rogo and Kabiru Alhassan Rurum, have defected to the ruling All Progressives Congress (APC).
KANO FOCUS reports that both lawmakers represent Rano/Bunkure/Kibiya and Karaye/Rogo federal constituency of Kano State.
Both lawmakers announced their defection at plenary presided over by Speaker Abbas Tajudeen.
On hand to witness the defection on the floor of the House was the national chairman of the APC, Dr. Abdullahi Umar Ganduje, accompanied by some members of the national working committee of the party.
However, the Minority Whip, Isa Ali JC, faulted the defection of the lawmakers on the basis that it was against constitutional provisions.
As of Thursday, no fewer than 30 members of opposition political parties have dumped their parties to join the APC.
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