KEY POINTS
- NNPC ends fuel imports by sourcing locally from Dangote Refinery.
- Nigeria aims to reduce FX pressure with local fuel sourcing.
- NNPC plans expansion in compressed natural gas (CNG) stations.
The Nigerian National Petroleum Company Limited (NNPC) has officially stopped importing refined petroleum products, now relying solely on fuel sourced from local refineries, including the Dangote Petroleum Refinery.
This move, disclosed by NNPC’s Group Chief Executive Officer, Mele Kyari, at the Nigerian Association of Petroleum Explorationists (NAPE) conference in Lagos, marks a major shift towards bolstering Nigeria’s energy independence. Themed “Resolving the Nigerian Energy Trilemma: Energy Security, Sustainable Growth and Affordability,” the conference focused on finding practical solutions to Nigeria’s energy challenges.
NNPC turns to local refineries to end costly fuel imports
According to Kyari, NNPC has fully transitioned to procuring fuel from local sources, including Dangote’s $20 billion refinery. By ending fuel imports, Nigeria can save on the N2 trillion previously spent monthly on imported fuel, as stated by President Bola Tinubu. This change not only reduces the strain on Nigeria’s foreign exchange but also redirects funds toward other critical areas, such as healthcare and education.
Kyari addressed concerns that NNPC had been unwilling to support local refineries, calling these claims “far from the truth.” He emphasized NNPC’s vested interest as part-owner of the Dangote refinery and affirmed that the decision to supply domestic refineries was an informed business strategy.
High-quality Nigerian crude offers opportunity, challenges for domestic use
According to a report by The Punch, Kyari pointed out the unique characteristics of Nigerian crude, dubbing it “Lamborghini crude” for its high quality and price. Although valuable, Nigerian crude is often blended with lower-grade crudes on the global market due to its premium price, making it costly for straight processing.
Kyari advocated for processing crude domestically to create value-added products for export. However, he also cautioned that exclusive domestic use of high-quality Nigerian crude may result in higher prices for local consumers. “We don’t need to sell gasoline from domestic production exclusively; other value-added products could be sold instead,” Kyari clarified.
NNPC clears cash-call debts, pushes for sustainable energy solutions
At the conference, Kyari announced that NNPC had cleared its $2.4 billion cash-call debt to international oil companies, an achievement made possible by ending the fuel subsidy. With these debts settled, NNPC can now focus on upstream development and domestic energy delivery.
Kyari also highlighted NNPC’s work with the government to address energy affordability through compressed natural gas (CNG) initiatives. By the first quarter of 2025, NNPC aims to establish 12 CNG mother stations across Nigeria, expanding access to cleaner, more affordable fuel options.
In conclusion, Kyari noted that while Nigeria remains one of the world’s leading oil producers, true energy security goes beyond PMS availability. Today, more than 50% of Nigeria’s population lacks access to electricity, and 70% lack access to clean fuel. With these initiatives, NNPC aims to meet Nigeria’s energy needs sustainably and affordably.
