The Nigerian National Petroleum Company Limited (NNPC Ltd) has estimated the pump prices for petrol sourced from the Dangote Refinery, with the price set at N950 per litre in Lagos, N992 in Abuja, and N1,019 in Maiduguri.
These prices vary based on landing costs and proximity to the Dangote Refinery in Lagos.
NNPC’s Chief Spokesperson, Olufemi Soneye, confirmed this in a statement released on Monday, attaching the estimated pump prices of Premium Motor Spirit (PMS) across NNPC retail stations.
The new prices are based on September 2024 pricing from the Dangote Refinery.
“Attached to this statement are the estimated pump prices of PMS (obtained from the Dangote Refinery) across NNPC Retail Stations in the country, based on September 2024 pricing,” Soneye stated.
A breakdown of the costs reveals that NNPC paid the Dangote Refinery N898.78 per litre, with additional charges including a NMDPRA fee of N8.99, an inspection fee of N0.97, and a distribution cost of N15 in Lagos. NNPC’s margin, or profit on each litre, is N26.48, bringing the estimated pump price in Lagos to N950.22 per litre.
According to Premium Times, these figures are higher than the current pump prices in Lagos, where petrol is sold for under N900 per litre at NNPC stations, .
Likewise, the new estimates for Abuja and other states surpass prevailing prices. Given that NNPC is the sole buyer of petrol from the Dangote Refinery, it is expected that independent marketers will purchase fuel from NNPC at these new prices, likely leading to an increase in pump prices nationwide.
Many independent marketers are already selling petrol for over N1,000 per litre, further complicating the price landscape.
Before the Dangote Refinery began operations, NNPC imported nearly all of Nigeria’s petrol, which placed immense pressure on foreign exchange and contributed to the naira’s depreciation.
Moreover, the importation process had been criticized for its lack of transparency, with allegations of fraud and substandard products.
The NNPC has promised greater transparency in its dealings with Dangote Refinery, stating that all costs will be disclosed and any potential discounts received from Dangote will be passed on to the general public.
As of September, NNPC confirmed it is paying Dangote Refinery in dollars for petrol, with naira transactions set to begin on October 1, 2024.
This is in line with the directive from President Bola Tinubu to sell crude to local refineries in naira.
“The NNPC Ltd can confirm that it is paying Dangote Refinery in USD for September 2024 PMS offtake, as Naira transactions will only commence on 1st October 2024,” Soneye said.
Though the refinery is expected to eventually produce enough fuel to meet Nigeria’s domestic consumption needs, oil and gas experts caution that the price of petrol will still be determined by market forces, despite being refined locally.
In response to NNPC’s pricing disclosure, Dangote Refinery had earlier disputed the N898.78 price quoted by NNPC as “misleading and mischievous.”
NNPC reiterated its stance, but stated it would welcome any discounts offered by the refinery, which would be passed on to consumers.
