Plumbing the depths of the Dangote vs NNPCL’s imbroglio, By Danladi Umar

In the wake of the operationalisation of the Dangote Refinery earlier in the year, the national oil company, the NNPC Ltd, has come under severe criticism, some justifiable and others unjustifiable. The excoriation has become more strident and abrasive since the Dangote Refinery rolled out its petrol into the market. This trend was taken to a whole new level by one Adamu Rabiu whose piece titled, “Dysfunctional NNPCL vs God-Sent Dangote Refinery”, was published in The Guardian of 3rd October.

In the piece, the writer insists that the relationship between the Dangote Refinery and NNPC Ltd is “fraught with contentions, subversion, and sabotage.” He goes on to highlight specific areas and incidents, which he believes, lend credence to his assumption of a war between the two entities. Unfortunately, his presentation of the incidents left much to be desired by any keen observer of the unfolding scenario as they mostly fly against truth.

For instance, he states that NNPC Ltd misrepresented its stake in the Dangote Refinery, claiming that it acquired 20 per cent stake when it actually acquired “a mere 7.2 per cent.” This issue of stake acquisition by NNPC Ltd is not something that happened long ago, such that people may have forgotten the details of how it happened. As a private citizen who has keenly followed the development in 2021, I think it is not right to allow the type of misrepresentation of the writer to stand. On the issue of the stake acquisition, which the writer accused NNPC of misstating, from every information available, it was just a case of someone desiring to buy a certain quantity of a particular product only to change his/her mind to buy a lesser quantity than earlier stated. Even to a bystander who is conversant with such desires and business projections, its difficult to see the “looming issue of falsehood and misinformation” in that?

The second thing for which Rabiu pilloried the NNPC Ltd is what he called Product Quality Concern or what I will refer to as the Dirty Diesel Saga. In the writer’s misunderstanding of the issue, his narration of the incident makes it look as if the first salvo in the saga was fired by the NMDPRA. He conveniently forgot that the first allegation about dirty fuel was made by the Vice President of the Dangote Industries Ltd, Mr Edwin Devakumar. He it was who first alleged that the regulator was licensing more companies to import dirty fuel into the country. It was very easy for anyone not to see through Devakumar’s game. Is it not curious that it was only when Dangote Refinery started producing diesel that all the diesel being sold for years in the Nigerian market became dirty?

But the real misinformation in the argument by Rabiu was that “Dangote’s own tests on diesel imported by the NNPCL… showed a much higher ppm exceeding 1,800 and 2,000.” The truth, however, is that the diesel which was bought from filling stations and allegedly tested by Dangote was not imported by NNPC Ltd. The company does not import diesel. Devakumar’s accusation was directed at independent marketers licensed by the NMDPRA. But Rabiu, apparently, was too anti-NNPC to sift through all the fine details of the situation before setting pen on paper.

The third untruth in that piece is what the writer described as “Monopoly Accusation.” He didn’t state clearly who accused Dangote of monopoly, but it could be inferred from his reference to the NNPC Ltd buying petrol from the Dangote Refinery at ₦898 per litre without allowing Dangote to state how much it sold the product that he was referring to the company. The questions that arise from this argument are: (1.) Was it the NNPCL that floated the allegation that marketers were importing dirty diesel in order to demonise the marketers and create a monopoly market for the Dangote Refinery in the diesel market? (2.) In what way did the NNPCL gag Dangote from disclosing how much it sold petrol to it when the company stated that it bought at ₦898 per litre? Does the NNPCL have the power or authority to bar Dangote from selling petrol to private marketers? Clear, fair and factual answers to these questions would reveal the erroneous basis of Rabiu’s piece.

The fourth issue stated in the piece is that of “Crude Sales in Dollars”. His argument is that it is illegal to sell crude oil to Dangote in dollars since the legal tender in Nigeria is the naira, and that the new arrangement to sell crude oil Dangote in naira was only a face-saving measure. The writer, however, failed to tell Nigerians in what currency Dangote sells diesel to private marketers in Nigeria. The Dangote Refinery, in a press release issued on 15th September by the company’s spokesman, Mr Tony Chiejina, clearly stated that it sold petrol to NNPC Ltd in dollars, and not naira. So, by Rabiu’s argument, Dangote is also a lawbreaker!

This leads to the fifth point raised in the piece which is “Pricing Dispute”. The writer agreed that the ₦898 per litre price that NNPC Ltd stated that it bought from Dangote Refinery was “significantly higher than the imported product price.” Then he goes on to state that Dangote has refuted NNPCL’s claims that it bought at the stated price, “calling it misleading.” But the company that refuted NNPC Ltd’s claim failed to state the price at which it sold its product to NNPC Ltd. If you claim that someone is misleading the public, the right and germane thing to do is to provide contrary facts, in this case, state the figure at which you sold! So, who is deceiving whom, or who is scamming whom here?

Rabiu’s sixth point is what he described as “Arrangement to Station NNPCL Personnel at the Dangote Refinery”. Obviously, the contention points to the fact that the writer believes that the Dangote Refinery, a God-given blessing to Nigeria, is above human and institutional regulations. That is the very reason the Refinery is arms with everyone, including the regulatory bodies – NMDPRA and NUPRC. The truth which Rabiu failed to acknowledge is that NNPC Ltd has a whopping $1 billion-dollar investment in the Dangote Refinery and is duty bound to ensure that its investment does not go waste.

The seventh point by Rabiu is what he referred to as “NNPCL’s struggling Refineries.” To be candid, the refineries have become a sore-thumb not only for NNPC but also for the country. It is not defensible that the refineries were allowed to get to the deplorable state where they have to require a complete retooling. But to allege fiscal irresponsibility in the financing of the refinery rehabilitation, as Rabiu did, is not correct. It is fairly well stated public fact that NNPC Ltd is funding the rehabilitation project with loans and not taxpayers’ money, as he alleged. The implication of this is that the lenders are keenly involved in the exercise which gives no room for lack of accountability and transparency. Yes, there is delay in the start-up of the Port Harcourt Refinery. Start-up difficulty is nothing new in projects like this. The Dangote Refinery had a similar experienced. That was why it didn’t start production until May this year despite the fact that it was commissioned in on 22nd May, 2023 – almost a full year! But after the delay, the Dangote Refinery came on stream. And so we pray that the Port Harcourt Refinery, and indeed the Warri and Kaduna Refinery will come on board for the good of our country!

Danladi Umar is an Abuja based public affairs analyst.