FG permits Air Peace, others to buy jet fuel directly from Dangote refinery

• The Federal Government has authorized Dangote Refinery to act as the only supplier of jet fuel to Nigerian airline operators
• This is as the airlines across the country designated the refinery as the only supplier of jet fuel for the aviation industry
• The aviation miniter said the step is appropriate given that Dangote and the FG just launched naira-for-crude agreement

Legit.ng journalist Zainab Iwayemi has over 3-year-experience covering the Economy, Technology, and Capital Market.

Dangote Refinery has been granted permission by the federal government to serve as the exclusive provider of jet fuel to airline operators in Nigeria.

Keyamo disclosed that the airline operators designate refinery as the only supplier of jet fuel for the aviation industry. Photo Credit: Dangote Group. Festus keyamo
Source: Getty Images

Festus Keyamo, the Minister of Aviation and Aerospace Development, made this known on Tuesday in an interview with Channels TV.

Keyamo disclosed that the airline operators had decided to designate the 650,000 barrels per day refinery as the only supplier of jet fuel for the aviation industry, with his support and agreement.

He pointed out that the action is timely given that Dangote and the Federal Government recently implemented a naira-for-crude arrangement.

Less strain on forex

The minister said that this arrangement will lessen the strain on Nigeria's foreign exchange.

“The airline operators just met recently. With my blessing, it’s a decision from the airline operators in Nigeria that they should only buy from Dangote refinery Jet A1.“You can see that yesterday we started a naira-for-crude purchase with Dangote. It’s all naira, no dollar component,” Keyamo said.

According to Keyamo, aircraft operators would be protected from the effects of changes in the price of crude oil by obtaining their fuel from Dangote, which would ultimately result in lower operating expenses.

“The price will no longer be subjected to the varying factors of the international market, nor the headwinds of oil price in the international market.“It will be in local currency so we can be clear as to the cost of it. We will buy in naira. I’m sure we are going to have access to cheaper Jet A1 fuel,” Keyamo said.

CEO lists reasons for hike in petrol prices

Legit.ng reported that Robert Dickerman, CEO of Pinnacle Oil & Gas Limited, has advised the federal government to address economic distortions and international investors' confidence to reduce the country's pump price of fuel, as the price of Premium Motor Spirit is still rising despite supplies from Dangote Refinery.

Dickerman asked Nigerians to reduce their expectations that the 650,000 barrels per day Dangote Refinery will bring substantial reductions in petrol prices in the country.

He also ascribed the rising cost of petrol and other commodities in Nigeria to the devaluation of the local currency.

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Source: Legit.ng