Davis Okpubuluku’s Post

I said exactly the same in my prior post. Federal Government of Nigeria is destroying investors confidence with the Dangote Refinery issue. See 👇 This whole issue on Dangote Industries Limited is shocking and creating bad waves for Nigeria globally - Akinwunmi Adesina of African Development Bank Group Monopoly often exists where there are high barriers to entry or high capital costs. How many individuals or companies can do railways? How many can do refineries of the scale of Dangote Refineries? In a nation that has been importing refined petroleum products for several decades, the abnormal simply became very normal. No smart investor would make a $19.5 billion investment and want it to be undermined by importers. To manufacture is extremely expensive and risky. This is even more so in Nigeria, given the very challenging business and economic environment, fraught with policy uncertainties and policy reversals, and where the self-defeating default mode of "simply import it" is always so easily rationalized and chorused to solve any problem. Competition is good for everyone. But is Dangote refineries anti-competitive? What is the evidence? Has Dangote refineries prevented any other company from setting up refineries? Why have others not done so? How come they have not done so for several decades? Was it Dangote that held them back? But Dangote refineries surely cannot be asked to 'compete' with importers of petroleum products. That is not competition. Let the importers set up local refineries and compete by refining in Nigeria. That is fair and justified competition.

It is utterly disgusting, disgraceful and annoying at the same time! How can a oil producing country without a single functional refinery in 2024 be frustrating (pressing the neck) one of its largest indigenous investor this way? This sometimes makes me wonder if we are really interested in the "ease of doing" mantra like we claim in this country. Dangote isn't saying NO to healthy competition. This seem like an unseen hand in play to frustrate the refinery from being operational. As of now, the nation does not have any functional refinery, which means that there is no competition to start with. More so, Dangote has given a very clear option, which is for NNPC to buy out the refinery and run it, so that there won't be any need for the "inexistent" competition, just like the Port Harcourt, Kaduna and Warri refineries are operational without any competition. If the government could be doing this to an indigent business, how then will the foreign investors look at us? This is a clear indication that the government isn't interested in the growth of the real sector. So many young people will be discouraged with this drama, because if with the economic and political clout of Dangote, he is being treated this way. I wonder what becomes of young people with no connection and financial war chest. I read an article of how an entrepreneur that's into car assembling, never got the support needed to locally manufacture tyres in the country due to the bureaucracy in the government, despite having a good business plan that shows feasibility and viability of the project. I don't know why everything that works in other countries always fail in Nigeria.

Nigeria! Musing on the raging argument about A refinery: This argument is going the wrong way and maybe orchestrated. Why would a locally manufactured refined product be costlier than an imported product? Why have we been clamouring for locally refined products? I don't buy into that side of the argument .However, all these shenanigans going on call for deep and sober reflections. Nigeria is under the apron of a mafia group. The oil industry has been hijacked such that only a total overhaul can save this nation. The truth is that the achilles tendon of this administration has a big sore that's self-inflicted. If Tinubu didn't know that the subsidy regime was corrupt and what he was going to do correct the system, then he had no right contesting for the presidency how much more presiding as one. The way this controversy is shaping up, if no surgical operation is carried out soonest, it will last the 4 years of this administration. If it lasts that long. A lot is unclear about the making of the Dangote Refinery and the will to bring down the cost of petroleum products in Nigeria. EKD

While having our refineries operational may seem like a solution, it's important to note that domestic refining doesn't automatically translate to cheaper fuel. The cost of crude oil, maintenance, and operational efficiency still influence prices. Government-owned refineries have historically been inefficient, requiring heavy subsidies and constant bailouts. Instead, a better approach might be privatizing these refineries, allowing more efficient management and reducing the financial burden on the government. Additionally, converting vehicles to Compressed Natural Gas (CNG) should be made more affordable. Nigeria has abundant natural gas resources, and incentivizing the use of CNG can offer a cheaper, cleaner, and more sustainable alternative to petrol, reducing our dependence on imported fuels while saving citizens money in the long run.

If I have the opportunity to meet with President Bola Ahmed Tinubu I won't ask for an appointment, contracts nor say Nigerians are suffering. I would say, His Excellency, kindly take decisive actions to have the government refineries working back. The refineries can work back if you wishes. Mr. President. The importation of fuels is sabotaging the economy and Dangote petrol whose many Nigerians thought would bring stability to Nigeria's chaotic petroleum industry. But not affordable to Nigerians. Even I heard that 11PLC (Formerly Mobil Nigeria), TotalEnergies, AA Rano, and other marketers have begun lifting Dangote Petrol from the Nigerian National Company (NNPC) Trading Limited at the rate of ₦765.99 per litre, which could simply means that NNPC is using the cost recovery method to sell the Dangote petrol to the marketers. If Dangote petrol is sold to NNPC Limited at ₦898.78 / Liter and NNPC is selling to marketers at ₦765.99, that mean ₦132.79 is been reduced and later on, NNPC will request for the dividends which means for the federation for the social welfare of Nigerians to help boost NNPC Ltd’s cash flow but the president can prevent this from continue sabotaging the economy and make Nigerians suffering by taking decisive actions to have the government refineries working back. If the President put all the government refineries to work and along with Dangote refinery, Nigeria will be the largest petroleum products export country in the continent. NNPC refineries can produce fuel grades that are affordable for domestic market while Dangote focus on the international market with its high grade fuels to earn foreign exchange for the country. With this, Nigeria will be one of the biggest petroleum products export country in the world. The lack of domestic refining capacity has wrecked the economy, which has resulted in a massive drain on foreign exchange reserves and there is a need for government to develop industrial sectors that support or leverage its energy resources. The actualization will make it possible for Nigeria to change from raw material supplier to value-added product supplier. To secure a steady supply of petroleum products to meet national energy security needs is very important to the nation. Nigeria go better in sha Allah 🇳🇬 #GodBlessNigeria #MayTinubuSucceed

Crude Oil Quota Allocation to Host Community for Niger Delta Oil Refiners Association Though it is difficult to manage the level of greed and selfishness in Nigerian society, yet, if it could be possible to regulate the population of local crude oil refiners in the Niger Delta, set up special teams of engineers and scientists in the refining industry from various reputable Nigerian tertiary institutions, integrate the engineering, science faculties with the Niger Delta local oil refiners to modify their traditional processing method using our scholars in that stead, I assure Nigerians that all these problems of shortage or scarcity of petrol and gimmicks of NNPC will be over. After all, Nigerians know that those Niger Delta refiners have been doing great, even, we leveraged on their output all these periods of laxity by NNPC. So, why are we pretending as if this is false? Is it because this local production is situate in the Niger Delta of Nigeria? GOD HELP Nigeria 🇳🇬

The Impact of a Functional Refinery in Nigeria By Lilian Fagbayi Nigeria, despite being Africa’s largest oil producer, imports most of its refined petroleum products. A functional refinery would significantly alter this dependency, providing numerous economic and social benefits. 1. Reduction in Fuel Imports: By refining crude oil domestically, Nigeria could lower its import bills, stabilize fuel availability, and potentially reduce prices, cutting its reliance on imported fuel. 2. Job Creation and Economic Growth: A functional refinery would create jobs directly within the refinery and indirectly across sectors like logistics and retail. It would lower operating costs for manufacturing, transportation, and agriculture, driving economic growth. 3. Boost to Foreign Exchange Reserves: Refining locally reduces the need for foreign currency to import fuel, which would strengthen the naira and improve the country’s balance of payments. 4. Energy Security: Domestic refining would provide Nigeria with greater control over its fuel supply, reducing the risk of shortages and improving economic stability. 5. Environmental and Social Benefits: Refineries that meet international standards would reduce carbon footprints and environmental risks. A stable fuel supply would improve the quality of life for citizens. 6. Encouraging Foreign Investment: A world-class refinery would attract foreign investors, boosting the downstream oil sector and other industries. 7. Reduction in Smuggling and Subsidies: Market-driven fuel prices, coupled with local refining, could reduce fuel smuggling and allow for a gradual reduction in costly government subsidies. A functional refinery is crucial for Nigeria's economic sustainability and growth, ensuring long-term benefits for its citizens.

This is the news I have been waiting for so Naira value can start appreciating. Dangote Refinery's contract with the Federal government is just for 6 months, I hope it will be renewed permanently so Nigeria can rebuild the economy as fast as possible focusing on real production with returns within a year, paying down existing debts, and *NOT* infrastructure or projects which will not yield results 5 to 10 years from now. If they have to do infrastructure and long term projects e. g CNG , it should be a few that will generate dollar revenue either directly or indirectly and *both* *principal* *and* *interest* repayment should be 7 years from now *at* *the* *least* . If the savings from the stoppage of refined crude oil is not directed to *short* *term* *positive* *production* , we might not see the expected appreciation in Naira value, even though Naira value will still appreciate. This is to reiterate my stand on my earlier write ups. Production, good security, cutting cost of governance and curbing corruption are the only ways Nigeria will move forward as a Nation, focusing on monetary policies alone will not work. Mr. Peter Obi Opeyemi Folorunso (FCIB,MBA,ASBC) Nairametrics Reno Omokri O'tega Ogra, FCIM Taiwo Oyedele

In 2007, shortly after Umaru Musa Yar'Adua became Nigeria's president, he revoked the sale of two oil refineries to a consortium led by Aliko Dangote, Africa's richest man, and his partner, Femi Otedola. The sale of the Port Harcourt and Kaduna refineries had been finalized during President Olusegun Obasanjo's administration in May 2007, just before he left office. The refineries were sold for approximately $750 million. Yar'Adua's decision to reverse the sale was based on concerns about transparency, fairness, and national interest. The key reasons included: 1. **Lack of Due Process:** The sale was criticized for not following proper due process and transparency. There were concerns that the privatization process had been rushed through at the end of Obasanjo’s presidency, raising suspicions about its legitimacy. 2. **National Interest:** The Yar'Adua administration argued that selling critical national assets like refineries could negatively affect Nigeria's control over its energy infrastructure. Refineries are strategic assets, and some believed they should remain under state control to protect Nigeria's energy security. 3. **Public Backlash:** The sale had faced public opposition, with labor unions, including the Nigerian Labour Congress (NLC) and oil workers’ unions, protesting the privatization. Many Nigerians viewed the sale as selling off national treasures to private individuals, potentially leading to job losses and exploitation. By revoking the sale, Yar'Adua intended to restore public confidence in government decisions, ensure transparency in privatization processes, and retain state control over key national resources. This was a response from ChatGPT. If Yar’adua had let Dangote take over the refineries in 2007, we would have scaled this hurdle ever since. Now, it’s taken us more than 17 years to get the Dangote refinery on board while the FG Refineries are still being refurbished or renovated with several hundreds of billions of dollars. Nigeria has spent a significant amount of money attempting to revive its refineries over the years, with billions of dollars invested in various repair and turnaround maintenance efforts. As of 2023, estimates suggest that **over $25 billion** has been spent trying to repair and revitalize the country's four refineries (Port Harcourt, Warri, and Kaduna), yet they have consistently operated below capacity or not at all. Pics: Port Harcourt Refinery.