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Nairaland Forum / Nairaland / General / Politics / Dangote, PH Refineries, Others Won’t Change Fuel Price – NNPCL (2505 Views)
After Promising New Petrol Price, NNPCL Moves To Make Cooking Gas Cheaper / Dangote, PH Refineries Face Crude Shortage Over Low Production – FG / Dangote, PH Refineries, Others Won’t Change Fuel Price – NNPCL (2) (3) (4)
Re: Dangote, PH Refineries, Others Won’t Change Fuel Price – NNPCL by Larry1960: 11:38am On Jun 02, 2023 |
nairalanda1: See ee h this your argument is somehow. I don't know if you listened to tvc this morning show There's this former Apc member (hon Etta) former acting national chairman he said onces dangote refinery starts production feul price would come down because freight sizes would be eliminated. All these your maintenance things staff salary etc so abroad wey Dem dey import am don't dey factor in those costs before selling to us. I still never understand this Nnpc man Sha 1 Like |
Re: Dangote, PH Refineries, Others Won’t Change Fuel Price – NNPCL by nairalanda1(m): 11:50am On Jun 02, 2023 |
Larry1960: The cost of refining and transporting petrol is very expensive. More than you think. 1 Like |
Re: Dangote, PH Refineries, Others Won’t Change Fuel Price – NNPCL by 1Alex: 1:15pm On Jun 02, 2023 |
Dennisbulkan:Thanks for taking time to explain. 1 Like |
Re: Dangote, PH Refineries, Others Won’t Change Fuel Price – NNPCL by Asswipemod: 7:23pm On Jun 02, 2023 |
DatNiggaDaz: Ani you no get sense. What falsehood has the guy posted that is giving you headaches? Has he not spoken the truth? Ehn, Wailer Banton? |
Re: Dangote, PH Refineries, Others Won’t Change Fuel Price – NNPCL by grandstar(m): 3:42am On Jun 04, 2023 |
LordAdam16: I think under the Petroleum Indistry Act, NNPC has been commercialized. It might therefore prefer to repair the refineries as it did the Port Harcourt refinery rather than dispose of them. This is Buhari's legacy 1 Like |
Re: Dangote, PH Refineries, Others Won’t Change Fuel Price – NNPCL by LordAdam16: 7:25am On Jun 04, 2023 |
grandstar: Of course, they'll want to budget funds for perennial repairs. NNPCL is wildly profitable. Expending a couple of billions on brownfields that'll never see full operation is an easy sell to top management as there'll be kickbacks. The scale of the theft will definitely be a magnitude lower. Rather than billions of dollars. It'd be tens of millions. But to eliminate that inefficiency completely, it's best to sell at least 2 of the refineries. I'll rather the refineries are sold and if private equity can't make them work, they should rot and be written off. There are 90 refineries in construction at the moment worldwide. And a refinery is generally shut every 4 years for refits, maintenance, and renovation. Our current slate of refineries never run optimally to pay for these mandatory interregnums. An independent player would be more motivated to squeeze out every ounce of performance from these refineries than the entrenched interests that have relied on these monuments of profligacy to fund lavish lifestyles for going on 3 generations of Nigeria's elite. -Lord 1 Like 2 Shares |
Re: Dangote, PH Refineries, Others Won’t Change Fuel Price – NNPCL by omohayek: 9:44am On Jun 04, 2023 |
SamboAnguissa:Well, for one thing, the foreign refiners from which the imported oil is being bought have probably already recovered most of the costs of their investment in physical facilities, while Dangote's refinery won't come close to doing for many years, maybe even a decade. In other words, any "profit" the refinery makes for the next few years will be illusory until the cost of building it has been paid off. Competitors with older plants are likely to have fully amortized their own costs by now. A second factor is the question of the interest rates at which Dangote borrowed any money he's used to set up the refinery. If his cost of funds was higher than that of foreign competitors, it will be reflected in the minimum he can charge without cross-subsidizing the refinery from his other businesses. Dangote has never been one for running losses without the prospect of obtaining a monopoly, and without government intervention, that is impossible to attain in a market as internationally competitive as this one. The third factor to keep in mind is the question of scale, and how quickly Dangote can ramp that up. In a business with high fixed costs like this one, the larger the scale of your output, the lower the production cost per unit, but getting to maximal scale won't happen overnight. First you have to build up a customer base with enough orders to keep your plants busy, you have to hire and train enough staff to cover sickness, absenteeism, quitting, etc., you have to sort out your transportation by booking enough shipping (but not booking more than your orders will require) ... The long and short of it is that there are hard business realities which put the lie to facile notions of Dangote's refinery as being some sort of magic bullet that will cut domestic petrol prices simply by existing. 3 Likes 1 Share |
Re: Dangote, PH Refineries, Others Won’t Change Fuel Price – NNPCL by baralatie(m): 10:31pm On Jun 13, 2023 |
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