The Dangote Group has voiced concerns over the Nigerian Upstream Petroleum Regulatory Commission’s (NUPRC) failure to deliver on a critical commitment outlined in the Petroleum Industry Act (PIA). Specifically, the group claims that the promised allocation of 29 million barrels of crude oil to Dangote Petroleum Refinery and Petrochemicals has not been fulfilled.
In a statement released on Friday, Anthony Chiejina, the Group Chief, Branding, and Communications Officer, expressed the company’s frustration with the NUPRC’s inability to provide direct access to crude oil from Nigerian producers, despite an earlier announcement of the allocation.
The NUPRC had previously declared that it had facilitated the allocation of 29 million barrels of crude oil to the Dangote Refinery. However, Dangote Group revealed that it has yet to receive these shipments, despite the official allocation. “We acknowledge the NUPRC’s statement regarding the allocation, but we must clarify that we have not yet received these cargoes,” Chiejina stated.
This issue arises within the broader context of the PIA’s implementation, a law enacted in August 2021 to reform Nigeria’s oil and gas sector. The PIA aims to enhance transparency, boost efficiency, and attract investment, with one of its key provisions requiring Nigerian refineries to source crude directly from domestic producers, bypassing international traders who have traditionally controlled the market.
Despite this, the Dangote Group’s statement highlights a gap in the enforcement of this provision. Chiejina noted that aside from a term supply negotiated directly with NNPC, the NUPRC has only facilitated the purchase of one crude cargo from a domestic producer, with the remainder being procured from international traders.
The company’s frustration stems from the NUPRC’s recent admission that it cannot fully enforce the domestic crude supply requirement as outlined in the PIA, citing the “sanctity of contracts” as a barrier. This has raised concerns about the effectiveness of the PIA and whether regulatory bodies are committed to implementing its intended reforms. “We are simply asking that Nigerian refineries be allowed to purchase crude directly from local producers, as specified in the PIA,” Chiejina emphasized.
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