The spokesperson for the Nigerian National Petroleum Company (NNPC), Femi Soneye, has explained why the company decided to reduce its stake in the Dangote Refinery.
Speaking during a Brekete Family programme on Monday (yesterday, August 12), Soneye provided insights into the decision.
In September 2021, NNPC acquired a 20 percent interest in the Dangote Refinery for $2.76 billion. However, on July 14, Aliko Dangote, Africa’s richest man, announced that the national oil company now holds a 7.2 percent stake in the refinery.
Soneye clarified that the reduction in NNPC’s stake was not due to any issues with the Dangote Refinery, emphasizing that NNPC was not collaborating with the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to undermine the refinery.
“The reason for reducing our stake in the Dangote Refinery is because we wanted to invest in Compressed Natural Gas (CNG). We observed that CNG is very cost-effective, and globally, there is a trend towards investing in clean and cheaper alternative energy,” Soneye explained.
He further stated that if Nigerians switch to using CNG, it would be more economical for them.
“That is why the NNPC is establishing various CNG stations across the country. We understand that with N10,000, Nigerians can fill their cars with CNG and use it for two weeks. Since gas is cheaper in Nigeria, we decided to invest in it, following the global trend,” Soneye said.
Addressing concerns about the Petroleum Industry Act (PIA), Soneye mentioned that the Act does not grant NNPC the authority to hinder the operations of the Dangote Refinery.
“We want all Nigerians to know that NNPC has no issues with the Dangote Refinery. We are co-owners of the refinery and have no intention of causing its downfall,” he stated.
Soneye stressed that NNPC has invested billions of naira into the Dangote Refinery, and with a 7.2 percent stake, there would be no reason for the company to sabotage such a significant investment.
Regarding NMDPRA’s role, Soneye clarified that Farouk Ahmed, the Chief Executive Officer (CEO) of NMDPRA, speaks about the Dangote Refinery in his capacity as a regulator overseeing all operators in the midstream and downstream sectors, including NNPC.
“Mr. Farouk Ahmed leads Nigeria’s midstream and downstream petroleum regulatory authorities, which have jurisdiction over all refineries. They manage anything related to the distribution of petrol and are actually superior to NNPC in this sector. We have no conflicts with them,” Soneye added.
Daily Query reports that the NMDPRA and Dangote Refinery have been involved in an ongoing dispute over crude supplies and some technical details relating to the Refinery’s products. (NAN with minor editing)
