Vice-president of Dangote Industries Limited, Edwin Devakumar, has said that the refinery and other local refiners have been unable to secure enough crude oil supplies despite the federal government’s plan to sell crude priced in the local currency.
To address challenges in accessing foreign currency, FG in July said it would sell crude priced in naira to local refineries for an initial six months starting in October.
Nigeria officially commenced the sale of crude oil to refineries in naira on October 1, forcing Dangote refinery to focus on local supply.
The refinery received four cargoes of crude oil from the NNPC under the naira-for-crude sale agreement recently, but it still looks to the US for crude.
“We need 650,000 barrels per day, (state oil firm NNPC Ltd) agreed to give a minimum of 385,000 bpd but they are not even delivering that,” said Edwin Devakumar, head of the Dangote refinery told Reuters on Friday.
Dangote Refinery built in Lagos aims to compete with European refiners when operating at full capacity, however, it has struggled to secure sufficient crude supplies to run optimally.
While Devakumar declined to give specific figures, he described deliveries from NNPC under the scheme as “peanuts”.
Still, Dangote is the only one of eight operational refineries in Nigeria to have benefited from the naira-denominated crude sale arrangement, said Mathins Obaze, an acting executive director of the Crude Oil Refinery-owners Association of Nigeria (CORAN), a trade group of refiners.
