By Firdaus Jibril
The Dangote Petroleum Refinery has cited the increase in the importation of Premium Motor Spirit (PMS) a major reason for its export to the international market.
In a statement on Wednesday citing data from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), the refinery noted that importation now accounts for about 43 per cent of petrol supplied to the Nigerian market in July.
The refinery said the continued inflow of imported petrol was creating uncertainty around domestic demand and forcing it to increasingly direct surplus products to regional and international markets.
According to the refinery, it has consistently maintained adequate petrol inventories and reserved volumes to guarantee uninterrupted supply to the Nigerian market since commencing operations.
However, it said the continued issuance of import licences without sufficient visibility on the actual volume of products expected into the country had made production and inventory planning increasingly difficult.
The refinery said holding large volumes of petrol without certainty of domestic demand comes with significant storage, logistics and financing costs.
It explained that when locally refined products are not immediately absorbed by the domestic market because of competing imports, the surplus must be evacuated to prevent inventory from accumulating.
Consequently, Dangote said its increasing export volumes in recent months were not a reflection of inadequate domestic supply capacity, but a response to the uncertainty created by imported products entering the market.
“As a responsible energy provider, we have always endeavoured to keep adequate reserves to satisfy local demand at all times,” the refinery said.
It, however, said maintaining excess inventory indefinitely was becoming commercially unsustainable in an environment where significant volumes of imported PMS continued to enter the country.
The refinery maintained that it remained ready and capable of meeting and exceeding Nigeria’s petroleum product requirements, adding that it continued to invest in storage, logistics and working capital to ensure reliable domestic supply.
It also warned that any future supply shortfalls arising from market distortions caused by excessive imports should not automatically be attributed to domestic refiners.
According to the refinery, uncertainty over import volumes makes it difficult for local producers to accurately forecast demand and align production with market requirements.
Dangote therefore called for greater transparency in petroleum product imports, improved market coordination and policies that would support domestic refining.
The company said such measures would strengthen Nigeria’s energy security, reduce foreign exchange pressures associated with imports and maximise the economic benefits of investments in domestic refining capacity.
The development comes as Nigeria’s downstream petroleum market adjusts to increased domestic refining capacity, with large-scale local production expected to reduce the country’s reliance on imported petroleum products.