NNPC lowered stake in Dangote refinery for CNG investment – Official

The spokesperson of the Nigerian National Petroleum Company Limited, Olufemi Soneye, has disclosed that the state-owned energy firm reduced its stake in Dangote refinery to invest in Compressed Natural Gas.

Soneye revealed that the NNPC capped its stake at 7.2 per cent instead of 20 per cent to build CNG stations across the nation.

He stated this while featuring on Berekete Family Radio, a video of which was sighted by our correspondent on Monday.

Soneye was called to speak on allegations that the NNPC was collaborating with the Nigerian Midstream and Downstream Regulatory Commission to sabotage the Dangote refinery.

He debunked the allegations that the NNPC would sabotage a company in which it had a 7.2 per cent stake.

He mentioned that the NNPC realised that CNG was more affordable as a better energy alternative for Nigerians, especially during the period of energy transition.

He added that Nigerians could fuel their vehicles with N10,000 when using CNG, compared to petrol.

“The reason for reducing our stake in Dangote refinery is because we wanted to invest in CNG. We observed that CNG is very cheap and all over the world, people are investing in clean and cheaper alternative energy.

“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 realised that gas is cheaper in Nigeria, why don’t we invest in it?” the NNPC official stated.

On the allegation of sabotage, Soneye posited, “We want all Nigerians to know that the NNPCL does not have any issue with the Dangote Refinery. We are part of the owners of the Dangote refinery and we don’t want it to collapse.

“We invested billions of naira into the Dangote refinery. As of today, we have a 7.2 per cent stake in the refinery. So, why would we want to sabotage such a company?”

He maintained that the Nigerian Midstream and Downstream Petroleum Regulatory Authority’s Chief Executive, Farouk Ahmed, was speaking in his capacity as a regulator in charge of all operators in the midstream and downstream, including the NNPC.

“Mr Farouk Ahmed is the head of Nigeria’s mainstream 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 posited.

In 2021, the NNPC acquired a 7.25 per cent stake in the refinery for $1.0bn, with an option to purchase the remaining 12.75 per cent stake by June 2024. But the national oil firm has since reneged on its decision.

The President of the Dangote Group, Alhaji Aliko Dangote, disclosed in July that the NNPC had only a 7.2 per cent stake in the refinery and not 20 per cent.

“The agreement was actually 20 per cent which we had with NNPC, and they did not pay the balance of the money up until last year; then we gave them another extension up until June (2024), and they said that they would remain where they had already paid, which is 7.2 per cent. So NNPC owns only 7.2 per cent, not 20 per cent.” Dangote stated.

Meanwhile, a former Minister of Education, Oby Ezekwesili, called for an independent audit to know why the NNPC capped its investment in the Dangote refinery at 7.2 per cent instead of 20 per cent.

“Did the Nigerian government not tell us it borrowed $3.3bn from Afrieximbank to take a stake in the Dangote refinery?” Ezekwesili asked.

She called on President Bola Tinubu to immediately launch an independent audit of the Dangote refinery-NNPC transaction to offer the public the true state of play.

The Dangote refinery was planning to sell the remaining NNPC 12.7 per cent stake this year for loan servicing, Fitch Ratings, a credit rating agency, said recently.