PENGASSAN urges FG to increase stake in Dangote refinery to 45%

The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has called on the Federal Government to increase its stake in Dangote refinery to 45 per cent from the current seven per cent.

Festus Osifo, president, PENGASSAN, made the call on Tuesday while presenting a communique and recommendations from the 3rd edition of the PENGASSAN Energy and Labour Summit in Lagos.

This, PENGASSAN said, is to foster product availability to meet local demand and ensure energy assurance and security for the citizens.

The union said the refineries should be modelled after the Nigerian Liquefied Natural Gas (NLNG) model, which appears to have been successful.

“Ramping up efforts to make the Nation’s four refineries work; once operational, the government should divest majority shareholdings. And own at most 49 per cent of the shareholding in the four refineries. Core investors will be brought in to take the 51 per cent as applicable in NLNG,” he said.

NLNG Limited is a joint venture incorporated in 1989 to produce liquefied natural gas and natural gas liquids for export. It is owned by four shareholders, namely, the federal government of Nigeria, represented by Nigerian National Petroleum Company Limited (NNPC Ltd) (49 per cent), Shell (25.6 per cent), TotalEnergies Gaz and Electricite Holdings France (15 per cent) and Eni (10.4 per cent).

Bemoaning a situation whereby the inter-land petroleum depots in six geopolitical zones of the country are dilapidated, Mr Osifo stressed the need for the government to get the depots fixed in collaboration with the private sector to ensure smooth distribution of petroleum products and enhance the national strategic reserve.

PENGASSAN also called for the expansion of pipelines that could be used in the delivery of refined petroleum products across the length and breadth of the country as this would reduce the pressure put on the roads by trucks carrying the products.

The group also recommended digital intervention to curtail crude oil theft, re-engineer security architecture, and ensure ease of doing business by reducing bureaucracies or complex regulations that make the gas investment unattractive to investors, among others.

Mr Osifo said those caught for crude oil theft should be punished severely by competent courts of jurisdiction to serve as a deterrent to others.

He said participants were worried that three years after the passage of the Petroleum Industry Act (PIA) the section of the act had not been implemented at all.

The act stipulated that 3 per cent of the operational revenue of the oil companies should be contributed to the host community fund.

He enjoined the government to also create a business-friendly environment by creating incentives for more investors to tap into the nation’s abundant gas resources.

In the upstream, it suggested an amendment of the PIA to include the divestment framework, noting that the previous divestments are not yielding results as the companies lack the financial capacity to sustain and expand the divested oil wells.

The group also enjoined the Nigerian energy sector to leverage Artificial Intelligence (AI) advancement to improve productivity and sustainability and tackle oil theft and smuggling.

In July, the NNPC Ltd said it now owns a 7.2 per cent stake in the 650,000 barrels per day Dangote refinery.

The oil firm made this known in reaction to a statement by Mr Dangote, that NNPC no longer owns a 20 per cent stake in the Dangote refinery.

Speaking at a press briefing at the refinery at the time, Mr Dangote said NNPC Ltd now owns only a 7.2 per cent stake in the refinery due to its failure to pay the balance of its share, which was due in June.

Confirming the development, the NNPC Ltd said its period assessment of the investment portfolio led to the decline in its share of the refinery.

On Monday, Mr Dangote said NNPC Ltd made a “big mistake” by reducing its stake in the refinery.

(NAN)