₦airaland Forum

TheGoodJoe:
I repeat, since the Subsidy is gone, why is there no refinery springing up if that was the reason.

Dangote worked because of massive government support. He got billions of dollars from Buhari 's government as loan. That is all.

If Government support more companies, they will bloom. The rest is story.

Malcolm21:
The price of crude oil has crashed internationally but why has Dangote not reduced the prices of his petroleum products? Because I noticed that when it was increased internationally he immediately increases his price but now that it's dropping why has he not followed suit

TheGoodJoe:
I repeat, since the Subsidy is gone, why is there no refinery springing up if that was the reason.

Dangote worked because of massive government support. He got billions of dollars from Buhari 's government as loan. That is all.

If Government support more companies, they will bloom. The rest is story.

reddingtonblack:
DO the calculation on his last stock in and show us how is cashing out

Shebi una get independent marketers, like mobil, total why are those ones selling cheap is it Dangote that hold them

As for the unfortunate being still supporting Tinubu, we hope you go to APC filling station its #300 per litre

chopnaira:
Which oil crashed? It is still expensive at my location abroad.

My country of residence has 16 refineries and 4th largest producer of crude oil in the world and petrol has been expensive since the senseless war in Iran.

Infact, I stopped driving my personal car for any work that takes me outside of the city and instead use the company vehicle.

Malcolm21:
But when it's increased it happens so sudden at the local market, is that not double standard

Malcolm21:
But when it's increased it happens so sudden at the local market, is that not double standard

yemre:
Well, the op is right to a large extent. However, I still wouldn't blame Dangote. He's a business man.

Why is it that, of all the people that have been given the license to build refineries,none of them have started anything?

Dangote could do this freely just because there are no stiff competition from anywhere despite being the 6th largest oil producing country in the world.

Imagine having about 10 other refineries of same magnitude or even bigger, scattered around the country, why would he not comply?

It's not as if we don't have people who have such money to build but the greed and the immediate gain mentality would not allow us do the right thing.

...and as a result, we all bear the consequences of our inactions.

blesdman:
Lafarge, Bua, Mangal are all producing cement yet cement prices keep going up. There is something wrong with Nigeria regulators in cement and petroleum industry. That guy that was blocking Dangote tendencies was blackmailed by Dangote to resign, now he is having a free ride in increasing prices of petroleum products. Using AGO as a case study, before the war when crude oil was 71$ and exchange rate 1400, AGO was 1000#, now that crude oil is just 100$, AGO should not be more than 1400# at same exchange rate; it does not make economic sense at all that AGO is at 1900. Dangote is ripping off the local market regardless of the war.

Malcolm21:
The price of crude oil has crashed internationally but why has Dangote not reduced the prices of his petroleum products? Because I noticed that when it was increased internationally he immediately increases his price but now that it's dropping why has he not followed suit

nairalanda1:
no

Subsidy made it difficult for other people to set up refineries back when Dangote was starting his own.

Because of the price controls inherent in subsidy no bank or financial lender would lend money to anyone with a refinery licence. The fact that subsidy was not going to go back then would have made building a refinery high risk

Dangote was able to get loans from the banks and even from CBN because at the end of the day, he had other lucrative businesses and assets. Had he defaulted on his loans because of subsidy price controls limiting his profits potentially, the lender's would have taken over his other businesses and repaid themselves.

That's why subsidy removal back in 2012 or even 1993 would have benefited Nigeria. It would have made lending to refinery licence owners easier because now banks know they would have seen their money back

TEYA:
Is the Straight of Hormuz open? See the Punch newspaper page you posted. Where did you get your information about the price of oil dropping in the internationalarket?

brain54:
Because he is a monopolist and an opportunist...

brain54:
Because he is a monopolist and an opportunist...

Princecalm:
Jul 29, 2015

The Nigerian National Petroleum Corporation has announced that the Port Harcourt and Warri refineries have been successfully re-streamed after a nine-month rehabilitation exercise conducted by its in-house engineers and technicians.

The corporation, in a statement, noted that both plants commenced preliminary production of petroleum products after successful test-runs, adding that while PHRC was ramping up its operation to about 60 per cent of its 210,000 barrels per day capacity, WRPC production was projected to hit 80 per cent of its installed 125,000bpd capacity.

The NNPC said the Port Harcourt refinery was projected to boost the nation’s local refining capacity with a product yield of five million litres of petrol per day, while Warri refinery would contribute 3.5 million litres of petrol.

Providing insight into the rehabilitation exercise, the NNPC noted that it had to adopt the phased rehabilitation strategy after the Original Refinery Builders, who were initially contacted for the project came up with unfavorable terms.

It said, “Though a decision was taken in 2011 to rehabilitate all the refineries using the ORB of each of the refineries, we were impelled to switch strategy after the ORBs declined participation and nominated some partners in their stead who came up with outrageously unfavorable terms.”

The NNPC stated that the nominated partners, as sole-bidders, came up with humongous price offers after two years of thorough and exhaustive scope of work definition and price negotiations.

It added that the proxies were also unwilling to provide post rehabilitation performance guarantees.

The corporation said, “The phased rehabilitation strategy which entailed phased and simultaneous rehabilitation of all the refineries using in-house and locally available resources in line with the spirit and letter of the Nigerian Content Law, also involved the use of Original Equipment Manufacturer representatives to effect major equipment overhaul and rehabilitation.”

The national oil firm said the phased rehabilitation programme, which started in October 2014 after the required funding stream was established, created a 70 per cent reduction in costs which helped largely in mitigating the financing challenges of refinery rehabilitation.

It observed that with the successful re-streaming of the PHRC and WRPC, attention has now moved to the 110,000 barrels per day Kaduna Refining and Petrochemicals Company which was billed to come on stream soon.

http://www.punchng.com/news/pharcourt-warri-refineries-commence-preliminary-operations-nnpc/

saintopus:
Dec 06, 2024
The PH Refinery ships its first export of petroleum products to Dubai.
The company is expected to load the cargo in the coming days onboard the Wonder Star MR1 ship, signalling the commencement of operations at the plant and the exportation of petroleum products.

The ship will load 15,000 metric tons of the product, which translates to about 13.6 million litres.

Although the volume coming from the NNPC into the global market is still small, the development has the potential to impact the Very Low Sulphur Fuel Oil (VLSFO) benchmarks in the future while changing the market realities for Atlantic Basin exporters into Nigeria and other regions.

The sulfur content of the export by NNPC stands at 0.26 per cent per wt and a 0.918 g/ml density at 15°C, according to Kpler, a data and analysis company.

The cargo was reportedly sold at an $8.50/t discount to the NWE 0.5 per cent benchmark on a Free on Board (FOB) basis.

Kpler reported that the development would help displace imports from traditional suppliers in Africa and Europe, as Nigeria’s falling clean product (CPP) imports are already decreasing, dragging imports into the wider West Africa region lower as well.

https://guardian.ng/energy/nnpc-begins-export-from-ph-refinery-as-dubai-firm-buys-first-cargo/

Malcolm21:
But when it's increased it happens so sudden at the local market, is that not double standard

yemre:
Very good point bro. BUA, Mangal and even lafarge are relatively unpopular in the market as much as Dangote. That simply means they are not competing enough. This could be in form of marketing, awareness or even product durability and quality. But the leverage remains the lack of stiff competition both in cement and petroleum products.

It's the major reason I would not discourage fuel importation despite having a local refinery because it's not just enough for effective pricing.

Reference:
After supporting Dangote to undermine the body responsible for superintending over his activities who do you think will have the guts to ask questions.
Shebi your Vice President called him an institution. I warned about removing the safety devices around governance, whether corporate governance or public governance including the Legislature, the unions and in this case the regulators.

Nigerians are not bright at all.
Free market does not translate to free to do as you please particularly if a business is essentially a monopoly. The scrutiny should be even deeper.

Ask the likes of the domineering US tech giants for instance what they see in the hands of American, European and Asian regulators. Power comes with responsibility. More power comes with graver responsibility.

A player like Dangote should have a permanent office close to the National Assembly because the place where the economy of this country is, his company will need to answer questions on a regular basis. It is that important.

Malcolm21:
But when it's increased it happens so sudden at the local market, is that not double standard