The Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) has declared its intention to primarily source Premium Motor Spirit (PMS), commonly known as petrol, from the Dangote Petroleum Refinery. This decision stems from the perceived inadequacy of the Nigerian National Petroleum Company Limited (NNPC) refineries in Port Harcourt and Warri to optimally produce PMS, focusing instead on naphtha production. DAPPMAN members express their readiness to engage with Dangote Refinery as the only viable petrol-producing facility in the country. The association emphasizes its commitment to local sourcing and its willingness to import only as a last resort if local supply from Dangote proves insufficient. This stance underscores the critical role of domestic refining capacity in ensuring a stable and reliable fuel supply for the Nigerian market. DAPPMAN’s preference for the Dangote Refinery reflects a strategic decision based on production capacity and product availability, highlighting the importance of efficient and effective refining operations in meeting national fuel demands.
A key challenge for DAPPMAN in its pursuit of local sourcing is the reported operational model of the Dangote Refinery. The refinery allegedly prefers a selective approach, dealing with a limited number of marketers via gantry supply. This contrasts with DAPPMAN’s operational preference for bulk purchases of 15-25 metric tonnes, facilitated by open access to loading facilities. While DAPPMAN expresses its willingness to purchase from Dangote, the association’s concerns lie with the refinery’s readiness to accommodate their bulk purchase requirements and offer competitive pricing. Ongoing negotiations between DAPPMAN and Dangote Refinery aim to resolve these operational differences, emphasizing the need for a mutually beneficial arrangement that ensures efficient product distribution while meeting the needs of all stakeholders. The successful resolution of these negotiations is crucial for establishing a robust local supply chain and minimizing reliance on imports.
Despite the ongoing talks, DAPPMAN maintains its commitment to providing its customers with quality products at competitive prices, irrespective of the source. The association reiterates that its primary goal is to serve the Nigerian market effectively, prioritizing local sourcing while remaining open to imports if necessary to ensure consistent supply and affordability. The association’s position emphasizes the importance of a flexible approach to sourcing, balancing the benefits of local production with the need to maintain a consistent and affordable fuel supply for consumers. This pragmatic approach underscores the complexities of the petroleum market and the need for adaptive strategies to address evolving challenges and opportunities.
The NNPC’s claims regarding the operational status of the Port Harcourt refinery have been met with skepticism from DAPPMAN. While the NNPC asserts that the refinery has resumed operations at a significant percentage of its installed capacity, producing various petroleum products including PMS, DAPPMAN contends that the refinery’s primary output is naphtha, not PMS. This discrepancy in reported production highlights the need for transparent and verified information regarding refinery operations. Accurate and reliable data are essential for informed decision-making by marketers, regulators, and other stakeholders in the petroleum industry. The conflicting narratives regarding the Port Harcourt refinery’s output underscore the importance of independent assessments and verification to ensure transparency and accountability in the sector.
Furthermore, the NNPC’s disclosure of blending practices involving components from Indorama Petrochemicals raises additional questions about the true origin and composition of the PMS purportedly produced at the Port Harcourt refinery. The NNPC defends this practice as standard procedure in refineries globally, necessary to meet specific product specifications. However, this explanation does not fully address DAPPMAN’s concerns about the limited availability of PMS from the refinery, potentially influencing their decision to prioritize sourcing from Dangote. The nuances of refinery operations, including blending practices, require greater clarity to foster trust and confidence among market participants.
In conclusion, the Nigerian petroleum market faces a complex interplay of factors influencing fuel supply and distribution. DAPPMAN’s preference for the Dangote Refinery reflects a strategic decision driven by the need for a reliable and substantial source of PMS. The ongoing negotiations between DAPPMAN and Dangote, coupled with the uncertainties surrounding the NNPC refineries’ operational status, highlight the challenges in establishing a robust and efficient local supply chain. The need for transparency, accurate information, and effective communication among all stakeholders is paramount to ensuring a stable and competitive petroleum market that serves the best interests of Nigerian consumers. The future of fuel sourcing in Nigeria hinges on the successful resolution of these challenges and the development of a sustainable and reliable domestic refining sector.
