NNPC Clarifies Role in Domestic Refinery Pricing, Rejects Sole Offtaker Claims
The Nigerian National Petroleum Company Limited (NNPC Ltd) has responded to claims made by the Muslim Rights Concern (MURIC) regarding its role in the operations of Dangote Refinery Limited (DRL). MURIC had alleged that NNPC Ltd’s actions, particularly the recent changes in the pump price of Premium Motor Spirit (PMS), would prevent DRL from offering lower prices, and further claimed that NNPC Ltd had become the sole offtaker of products from the refinery.
In a statement addressing these claims, NNPC Ltd clarified the following points:
- Pricing Determined by Global Market Forces: The prices of petroleum products from DRL, or any other refinery, are dictated by global market dynamics. NNPC Ltd stressed that the recent changes in PMS prices do not hinder DRL or any other domestic refinery from accessing the Nigerian market. If the current pump prices are seen as high, it creates an opportunity for DRL to offer more competitive prices.
- No Guarantee of Lower Domestic Refinery Prices: NNPC Ltd pointed out that lower prices are not guaranteed by domestic refining, as product pricing still follows global parity frameworks. NNPC Ltd will only fully offtake PMS from DRL if the global market prices exceed the local pump prices. Otherwise, DRL and other refineries are free to sell to any marketer under a “willing buyer, willing seller” model, which is standard for deregulated products.
- Rejection of Sole Offtaker Role: NNPC Ltd made it clear that it has no intention of becoming the exclusive distributor for any refinery in a free market environment. The company emphasized that the concept of being a sole offtaker does not apply in the current deregulated system.
- Billion-Dollar Stake in Dangote Refinery: NNPC Ltd reiterated that it cannot undermine a business in which it holds a significant investment, countering MURIC’s claims that NNPC Ltd’s actions could harm DRL.
NNPC Ltd concluded by urging MURIC to verify facts before making public statements that could mislead Nigerians or incite negative sentiments against the company.
