₦airaland Forum

The President and Chief Executive of Dangote Group, Alhaji Aliko Dangote, has called on the Federal Government to end fuel subsidies completely.

He said the removal would help determine the actual petrol consumption in the country, as he confirmed ownership of two oil blocks in the upstream sector with an expected production date of next month.

Dangote also stated that fuel production from his $20bn mega refinery in Lagos will help ease pressures on the naira. The refinery can refine 650,000 barrels of crude oil daily.

Speaking in a 26-minute interview with Bloomberg Television in New York on Monday, monitored by our correspondent, Dangote said now is the right time to end fuel subsidies.

Africa’s wealthiest man further noted that ending petrol imports will have a huge upside in easing currency pressures.

He said, “Subsidy is a very sensitive issue. Once you are subsidising something then people will bloat the price and then the government will end up paying what they are not supposed to be paying. It is the right time to get rid of subsidies.”

“But this refinery will resolve a lot of issues out there, you know, it will show the real consumption of Nigeria, because, you know, nobody can tell you. Some people say 60 million litres of gasoline per day.

“Some say, it’s less. But right now, if you look at it by us producing, everything can be counted. So everything can be accounted for, particularly for most of the trucks or ships that will come to load from us. We are going to put a tracker on them to be sure they are going to take the oil within Nigeria, and that, I think, can help the government save quite a lot of money. I think it is the right time, you know, to remove the subsidy.”

Dangote who recalled the challenges faced after the project’s launch in 2013, experiencing a five-year delay due to issues with state government and host communities and a running loan of $2.4bn, said he is personally proud to achieve the feat.

On whether the subsidy will make the refinery viable, Dangote said, “Well, you see, we have a choice of either one. We produce, we export, and when we produce, we sell locally. But we are a big private company. And yes, it’s true, we have to make a profit. We build something worth $20bn so definitely we have to make money.

“The removal of subsidies is totally dependent on the government, not on us. We cannot change the price, but I think the government will have to give up something for something. So I think at the end of the day, this subsidy will have to go.”

President Bola Tinubu removed the subsidy when he took office in May 2023, exacerbating a cost-of-living crisis that sparked protests, but quickly reinstated it as inflation spiked.

Another step to ending it was taken in early September when the gasoline cap was eased — though the price remains below the market level.

Nigeria, until Dangote’s refinery came on stream was fully dependent on imported petroleum products, and has been taking tentative moves to finally end the nation’s pricey fuel subsidies, which in 2022 cost $10bn.

Dangote, who has the option of either exporting his fuel or selling it domestically, said the decision on subsidies was the government’s, but added that ending gasoline imports will have a huge upside in easing currency pressures.

The naira has lost around 70 per cent of its value against the dollar since rules that pegged the currency at an artificially high level were relaxed last year.

But the scarcity of the greenback in the Nigerian foreign exchange market continues to weigh on the naira and is made worse by the need to pay for imported gasoline in dollars.

“Petroleum products consume about 40 per cent of our foreign exchange,” Dangote said, adding that fuel from his refinery, which started supplying gasoline on Sept. 15 to the state-owned oil company for domestic sale, “can actually stabilize the naira.”

Continuing in the interview, the businessman revealed the details of the pricing disagreement that occurred with the Nigerian National Petroleum Company Limited.

He said the national oil company bought its current stock from the refinery at a cheaper price than its imported fuel but gave a uniform price for all products.

“There wasn’t really a disagreement, per se. NNPC bought from us on the 15th of September at the international price, which they also bought, about 800,000 metric tons of gasoline imported. So the one that they bought from us actually is cheaper than the one they are importing.

“And so when they announced our price, the guy, I don’t know whether he was authorized. It wasn’t really the real price. What they have announced is most likely that is what it cost them, including profit and other expenses.

“And then the other one is one that they imported. But the people don’t know how much they spend in terms of imports, but their importation is almost, maybe about 15 per cent more expensive than ours, you know.

“So what they are supposed to do is to sell at a basket price, or if they want to remove subsidy, they can announce that they will remove subsidy, which is okay, everybody you know will adjust it.”

On the planned crude oil sales anticipated to begin in October, Dangote said that discussions are still ongoing and a detailed agreement will be finalised this week.

Revealing details of the deal, he explained, “We will sell the crude in naira after we have bought in naira. So now we are currently working out with the committee that the exchange rate is going to be priced. It is going to be normal pricing, you know, if crude is at $80, we will pay that price at an agreed exchange rate.

“And then we will also sell in the domestic market. What that will do is that it’s going to remove 40 per cent pressure on the naira. So because, see, the petroleum products consume about 40 per cent of foreign exchange, so you know, and then, you know, it’s like you have 40 per cent of demand been taken out so that can actually stabilize the naira and even if they subsidise, they would know what they are paying for.

“The deal is to give the government something that they want. It’s also a win-win situation for all and it would benefit the country.

“Currently, discussions are still ongoing to determine the details of the agreement. They are working out something that I think would be a win-win between us and the NNPCL.

“The agreement is very robust. Well, first of all, we would have energy security where they will give us crude. For example, in October, they’re going to give us 12 million barrels, which is on average, about 390,000 barrels a day, which will sell both gasoline, diesel, and aviation fuel.”

He also confirmed ownership of two oil blocks in the upstream sector with an expected production date of next month.

Dangote tankers’ park

Meanwhile, the Federal Government has said that it is providing land for interested entities to build an expansive park for tankers lifting petrol and other products from the Dangote refinery.

This followed a routine inspection on Sunday by the Minister of Works, Dave Umahi, who raised concerns about over 3,000 fuel tankers queueing up on the new concrete pavement road.

Umahi noted that though the pavement is made of concrete the current road was not designed to handle static load and may soon deteriorate like the ever-busy Apapa road.

This minister revealed this to State House Correspondents after Monday’s Federal Executive Council meeting at the Aso Rock Villa, Abuja.

He said, “From my inspection yesterday, we discovered that we had over 3,000 fuel trucks queuing for the Dangote fuel lifting, and they were all parked on the newly constructed road.

“Technically and by design, the roads were never built for static loads. And so it has a lot of effects. So, we will have the same thing we had in Apapa that damaged the entire road until it was constructed on concrete.”

“So what FEC approved today is that the land that we have, the Federal Government land, we should put it for concession so that concessionaires would bid and whoever wins will be able to build a park. The park will be tolled so all those trucks can safely park there. And the pavement of such a park is quite different from the pavement of the road.”

Umahi also announced that the council approved various road projects. He said, “The council approved several road projects. One is a new contract for rehabilitating Maraban-Kankara-Funtua Road in Katsina state. The second is the award of a contract for the construction of a 258km three-lane carriageway, a component of the 1,000 Sokoto-Badagry superhighway section two, phase 2A in the Kebbi Section. It is to be done with continuous reinforced concrete pavement. It excludes all bridges and flyovers.

“The third one is the contract for the construction and dualisation of Afikpo-Uturu-Okiwe in Ebony, Abia, and Imo State, Section Two. The next one is the Bodo-Bonny road in Rivers State under Julius Berger. The Federal Executive Council approved an additional N80bn to complete that project, bringing the total cost to N280bn.

“The next is the third mainland bridge. The third mainland Bridge was executed under emergency work. When you have emergency work, you have to get going, measure the work, and send all your measurements and quotations to the BPP. And that’s what we did. So that has been done, and it’s also extended to Falamo and Queens Drive. It also came with solar-powered light. The essence is that all through the length and breadth of the road, the security agencies will be able to check everything happening within the length and breadth of this bridge. And we give response time to respond to any eventuality for 10 minutes. So the contract covers about four security vans and one-speed boat.”

Other contracts include the N158bn contract approved for the Lekki Port service lanes by Dangote Industries, linking Epe to Shagamu-Benin Expressway. The council also approved the N740.79bn Abuja-Kaduna-Zaria-Kano Road re-scoped with solar lighting under a 14-month completion by Julius Berger.

Umahi also named about 14 road projects and bridges affected by floods, including Ado-Ekiti-Afe Babalola in Ekiti State and Lafia-Shendam Road in Plateau State.

Source: https://punchng.com/Why-FG-must-end-petrol-subsidy-now-Dangote

Story

But Tinubu and his supporters have been claiming subsidy is gone since May 29 2023...

Tinubu and lies supported by his lying supporters

Subsidy is expensive to maintain and already crippling us as an economy but i disagree with him here.

The actual consumption figure cannot be quaged by what goes out of his refinery. The NNPCL is stepping in as a monopoly force in order to drive prices down on behalf of a govt eager to lower prices. That leaves us still with difference between our prices and our neighbour's and thats the basis for smuggling.
Tracking trucks is good but there are other means of smuggling it from border areas out.

Why

The one dem do never do

Until dem kill us finish

Advice from a madman? Dangote is the real definition of state capture. Not even state, na country capture. He is a business man, understood. But this continued drive at monopoly and edging out all competition should be on a leash. You got all kinds of subsidy and waivers building your refinery. Even your crude oil raw material is subsidized. Now you are producing and saying other people's subsidy should be removed. Most Nigerians are like this, they get there and ask that others should not be allowed.

Tinubu should not remove the fuel subsidy completely. Crude oil is a mineral deposited in large quantities in Nigeria.

Tinubu should improve the relationship among local communities in the Niger Delta region, IOCs and the government. This is the only way we can end oil theft, increase local crude oil production and meet our OPEC quota.

Removing fuel subsidy totally will worsen the economic situation of this poor country. Meanwhile, the entire country shouldn't depend on Dangote. There are other modular refineries; they should be licensed to refine PMS.

But I thought Subsidy is gone?

Thought our Chicago state University Accountant said at his his inauguration that subsidy was gone. Bunch of legal thieves

Nigerian brace up. Petrol 2000 by December.

Dangote want to monopolize the PMS as he did with his Cement.

Make una continue

[color=#1986BC] So that you will have complete monopoly?[/color]

[b] not when fuel is 54naira in Libya [/b

Imagine landing cost will be below 300 naira if bought from cheap Libya

Nigerians have so nany deluded minds who have refused to wake.
1. Earth, this world, is all an illusion, it's actually a prison
2. Religion is the psychologist that prevents the minds from breaking free.
3. The truth is right in front of us, but no one will see it.
4. Use the template of the prisons you know and understand how life works.
5. Prisoners in Nigeria find themselves here because of the choices they made in the last life, like a prison, if you comit a crime you are put in prison,
The severity of the crime determines the type of punishment and prison you are put in, compare kirikiri and ikoyi prison, same PRISON different punishment

Now back to Nigeria.
Nothing will ease the suffering, Nigeria is like the kirikiri prison.
We owe sentences that we are serving presently in this prison,
religion says there is heaven for rest, this is not true,
Religion don't want you to rebel the controllers of the prison or try to escape through suixide.

There is no complex in solving Nigerias problem, but it will never get solved.
It's how Nigeria was programmed

Dangote is just one of the tools used to run the program.
Same is tinubu and buhari
Fuel will never be cheaper .
If a leader comes in to try and make the country better or change the state of the programmed suffering, he will be removed or killed
E.g gadafi of Libya, even GEJ Obama was involved in his removal

Know that, fuel is simply from the fractional distillation of crude, very simple process using heat and different distillation chambers

Uneducated folks do it well in my home town with stolen crude and convert to diesel kerosene and fuel,
But ask your self, why can't there be working refineries?

Even modular ones for this ppl to work and earn while they produce fuel in their localities??

It's because This prison was programmed for much more suffering than the ones in the west,

No body will save you, complete your sentence or find a way to be transfered to another prison(japa) with good behavior same way criminals are moved from one prison to the other, your behaviour will be checked at embassies and visa approved if you served ur sentence here with good records.


There is no happy ending here

We are here to suffer
The more you understand the easier it is to navigate your plans

And this is why some of the worst beings are found in Nigeria, it's not a coincidence, it's similar criminals serving their sentence in same prison.

Just like you can't send an economic and financial criminal to a prison for murderers and rapist, he is sent to a prison with ppl of similar crime,
This is why majority of Nigerians are criminal minded the same way, always ready to cheat, to steal , to be corrupt.

Petrol price about to shoot up again....

Fact

Ok

No wahala nah

Noted

Xwizard:
[b] not when fuel is 54naira in Libya [/b

Imagine landing cost will be below 300 naira if bought from cheap Libya

lol.

He's out to make profit.

......this from Dangote?

The masses that supported and usher in APC are on their own now, abandoned.

If you know you know

Come Aliko, I don't understand you again, you mean with petrol at #1200 per liter, subsidy never still finish.

Have you ask how much they are selling fuel in Libya?

So how do they manage to sell fuel that low in that country that Nigeria can't copy them.

From Dangote's statement..does it mean federal government is still paying subsidy?

I am baffled...

Who are they deceiving?

Dangote truly is a fool. Imagine paying $100m for a piece of land in Lekki. Truly, the rich class wey dey the country are just a bunch of money miss road.

This man is one of the major problems we have in Nigeria

Anyone who effectively removes subsidies fights corruption, but given what Dangote has revealed thus far, this appears to be nearly impossible.

If I were president, I would simply shift my focus to renewable and nuclear energy in order to repower industries, trains, and automobiles so that all those who fled due to power outages could return to Nigeria. Then, use clean energy and sustainability with agricultural and blue ocean resources to continue increasing our GDP. Monopolies in the mining sector, I believe, are easily defeated, so I would focus on that as well. This strategy is still easier than fighting oil monopolists and Lords.

When the economy no longer supports oil and gas, it will be too late for them. They will perish naturally. The government can then resume oil production if there is still little revenue to be generated.

If not, we will not get out of this wahala easily. These oil Lords must be caught off guard, and I believe disruptive innovation is the only easy way to accomplish this.

Where is subsidy in the NNPC price template released recently?

Ok