The federal government says Dangote Petroleum Refinery, DRL, will commence the distribution of premium motor spirit (PMS), also known as petrol, on Sunday. The NNPC Limited, NNPCL, will distribute petrol from the 650,000 barrels-per-day DPL to the local market, ending the deadlock that had stalled distribution.
The $20 billion refinery, built by Nigerian billionaire Aliko Dangote, began processing gasoline last week. However, disagreements over offtake rights and pricing had delayed distribution.
Wale Edun, the minister of finance and coordinating minister, who was represented by Zacch Adedeji, executive chairman of the Federal Inland Revenue Service (FIRS), said all agreements have been completed for the loading of the first batch of petrol.
“I am glad to announce that all agreements have been completed and loading of the first batch of PMS from the DRL will commence on Sunday, September 15,” Edun said.
Adedeji said that in exchange for crude oil, DRL will supply gasoline and diesel of equivalent value to the domestic market, with transactions settled in the local naira currency.
The Nigerian government previously said it would facilitate the sale of crude to DRL in naira.
While DRL’s diesel, which has primarily been exported, will now be sold to local fuel traders in naira, NNPCL will have exclusive rights to lift gasoline and sell locally both in bulk to fuel traders and at its gas stations for now.
The minister said the Nigerian National Petroleum Company (NNPC) Limited, NNPCL , will supply about 385,000 barrels of crude oil per day (bpd) to the DRL starting next month.
“From October 1, NNPCL. will commence the supply of about 385,000 bpd of crude oil to the Dangote refinery, to be paid for in naira,” he said.
“In return, the DRL will supply PMS and diesel of equivalent value to the domestic market, to be paid in naira.”
However, the minister said the DRL can sell diesel to any off-taker.
“Diesel will be sold in naira by the Dangote refinery to any interested off-taker. PMS will only be sold to NNPC, NNPC will then sell to various marketers for now,” he said.