NNPC to End Monopoly on Dangote Refinery’s Petrol Sales
The Nigerian National Petroleum Company Limited (NNPC) is set to end its role as the sole off-taker of petrol from Dangote Refinery, according to a report from PREMIUM TIMES.
Recall that on September 15, NNPC began loading petrol from Dangote’s facility, with independent marketers excluded from purchasing the product from the refinery.
Describing it as a burden, an NNPC official told PREMIUM TIMES:
“Yes, it is true,” the official said. “We can no longer continue to bear that burden.”
This comes against the backdrop of a lawmaker in the House of Representative, Oboku Oforji (PDP, Bayelsa), moving a motion aimed at ending NNPC’s monopoly in petrol distribution.
Oforji expressed concerns over the monopoly being created by restricting fuel lifting to only major marketers, warning that independent marketers may resort to imports to sustain their businesses.
“The House is worried that NNPCL and major marketers as exclusive off-takers spell monopoly, which is equivalent to greed. This is the same NNPCL that has failed to manage our crude and refineries for decades,” Oforji noted.
There has been growing concern among Nigerians that the exclusive access given to NNPCL to lift Dangote’s petrol will create a monopoly that could lead to a price hike in the product.
Earlier, Aare Afe Babalola, the founder of Afe Babalola University (ABUAD), asked NNPCL to dismantle its monopoly on fuel sales and allow the Dangote Refinery to sell fuel at competitive rates that could alleviate the financial burden on Nigerians.
“If Dangote has invested heavily in building a state-of-the-art refinery, why should NNPC require him to sell to them first?” Babalola questioned. “Let anyone who can build a refinery do so and sell directly to the public. This competition will drive prices down.”
Although the recent move might result in another increase in the price of fuel, as NNPC will not subsidize the differential between Dangote’s selling price and the price to marketers, the withdrawal of the monopoly will lead to the complete liberalization of the market.
