The Nigerian National Petroleum Company (NNPC) Limited has clarified that its decision to reduce its stake in the Dangote Petroleum Refinery from 20% to 7.2% was made to allocate funds for investments in compressed natural gas (CNG). NNPC’s spokesperson, Femi Soneye, shared this information during an appearance on the Brekete Family programme on Monday.
Originally, in September 2021, NNPC acquired a 20% stake in the Dangote Refinery for $2.76 billion. However, by July 14, Aliko Dangote, Africa’s richest person, announced that NNPC’s share had been reduced to 7.2%.
Explaining the rationale behind this move, Soneye said, “The reason for reducing our stake in the Dangote Refinery is because we wanted to invest in CNG.” He highlighted that CNG is an affordable and clean energy alternative gaining global popularity. “If Nigerians use CNG, it will be cost-effective for them. That is why the NNPC is building different CNG stations everywhere. We understand that with N10,000, Nigerians can fill their cars and use it for two weeks. We realized that gas is cheaper in Nigeria, so why don’t we invest in it since this is what people are doing all over the world?” he added.
Soneye also addressed allegations of sabotage regarding the Dangote Refinery, strongly denying any such intentions. “We want all Nigerians to know that the NNPC does not have any issue with the Dangote Refinery,” he stated. “We are part owners of the Dangote Refinery and we don’t want it to collapse.”
Further, Soneye emphasized the significant investment NNPC has in the refinery, saying, “We invested billions of naira into the Dangote Refinery. As of today, we have a 7.2% stake in the refinery. So, why would we want to sabotage such a company?”
Soneye also spoke about the ongoing dispute between the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Dangote Refinery. He clarified that the Petroleum Industry Act (PIA) does not grant NNPC the authority to halt operations at the Dangote Refinery. He explained that Farouk Ahmed, CEO of NMDPRA, acts as a regulator overseeing all midstream and downstream operators, including NNPC.
“Mr. Farouk Ahmed is the head of Nigeria’s midstream and downstream petroleum regulatory authorities. They have power over all refineries. Anything that has to do with the distribution of petrol, they are in charge. In fact, they are superior to the NNPC in that sector. We don’t have anything to do with them,” Soneye said.
The disagreement between NMDPRA and the Dangote Refinery escalated on July 18, when Ahmed alleged that local refineries, including the Dangote Petroleum Refinery, were producing inferior products compared to imports. He also claimed that Dangote requested the suspension of all petroleum product imports and directed all oil marketers to source from his refinery. Dangote has denied these claims.
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