In a significant shift for Nigeria’s petroleum industry, the Nigerian National Petroleum Company Limited (NNPC) has officially ceased the importation of refined petroleum products. Instead, it will now source fuel from the newly commissioned Dangote Petroleum Refinery, as well as other local refineries in the country. This announcement was made by Mele Kyari, the Group Chief Executive Officer of NNPC, on Monday during the ongoing Nigerian Association of Petroleum Explorationists (NAPE) conference in Lagos. The conference, themed “Resolving the Nigerian Energy Trilemma: Energy Security, Sustainable Growth and Affordability,” is being attended by key industry players and policymakers.
Kyari’s statement marks a historic moment for Nigeria, a country that has long been a net importer of petroleum products despite being one of the largest oil producers in Africa. NNPC’s move is in line with President Bola Tinubu’s vision for energy self-sufficiency, which includes a multi-faceted strategy to boost local production and reduce dependency on foreign imports.
Fuel Imports to be Phased Out
In his remarks, Kyari highlighted that the decision to stop importing refined petroleum products is a major milestone in Nigeria’s quest for energy security and economic stability. By tapping into the output of local refineries such as the Dangote Petroleum Refinery, which is set to produce over 650,000 barrels of refined oil daily, the country hopes to mitigate the financial strain caused by the importation of petroleum products.
In recent years, Nigeria has faced escalating costs of importing fuel, with the country spending an average of N2 trillion monthly on petroleum imports. President Tinubu, speaking earlier in August, outlined plans to reduce this expenditure and save up to N2 trillion monthly by harnessing the potential of compressed natural gas (CNG) and transitioning to a more diversified energy mix.
“The launch of CNG into the country will save us over N2 trillion every month that we currently spend on importing PMS (Premium Motor Spirit) and AGO (Automotive Gas Oil), freeing up these resources for critical investments in healthcare, education, and other sectors,” Tinubu explained.
Industry Response
While NNPC’s move to rely on local refineries has been widely welcomed by government officials, some petroleum marketers have raised concerns. A number of marketers have insisted that they can still import petroleum products at a lower cost than the Dangote refinery, which is backed by a $20 billion investment. These marketers argue that competition from imported products could keep local prices in check, especially in the face of fluctuating global oil prices.
However, government officials remain optimistic that the Dangote refinery, which is expected to meet a significant portion of Nigeria’s domestic fuel demand, will not only stabilize prices but also create jobs and enhance local economic growth. As the largest private refinery in Africa, Dangote’s facility is poised to become a game-changer in the country’s energy sector, significantly reducing the country’s reliance on fuel imports.
A Broader Vision for Energy Sustainability
The Nigerian government’s overarching goal is to resolve what President Tinubu has termed the “energy trilemma”—a complex challenge involving energy security, sustainable growth, and affordability. With the launch of CNG, the government is looking to diversify energy sources, reduce environmental impact, and provide more affordable energy solutions to millions of Nigerians.
As part of its energy strategy, the government is also focusing on enhancing power generation capabilities, improving distribution infrastructure, and expanding renewable energy sources. Nigeria’s move towards energy self-sufficiency comes at a critical time as global energy prices remain volatile, and the country seeks to unlock new economic opportunities for its citizens.
Key Takeaways:
NNPC halts refined petroleum imports, opting for local refineries like Dangote’s.
President Tinubu aims to save over N2 trillion monthly by reducing reliance on fuel imports and promoting compressed natural gas.
Some marketers express concerns about competition with local refineries, but the government remains confident in its strategy.
Nigeria’s long-term energy strategy involves boosting energy security, fostering sustainable growth, and making energy more affordable for the populace.
