Dangote Petroleum Refinery and Petrochemicals (DPRP) has expressed concern over the continued issuance of petroleum product import licences, saying rising imports are forcing it to increasingly export surplus production despite having sufficient capacity to meet Nigeria’s domestic Premium Motor Spirit (PMS) requirements.
The refinery said it remained committed to supporting Nigeria’s energy security and ensuring uninterrupted fuel availability but warned that significant volumes of imported PMS were creating uncertainty around domestic demand, production planning and inventory management.
According to market data available to the refinery, imported PMS accounted for approximately 43 per cent of fuel supplied to the Nigerian market in July.
DPRP said the level of imports raised questions about the need for continued large-scale importation when substantial domestic refining capacity was available.
Since commencing operations, the refinery said it had consistently maintained sufficient inventories and reserved product volumes to guarantee steady supply to the Nigerian market.
It added that maintaining those reserves required substantial investment in storage, logistics and working capital as part of efforts to protect the domestic market from supply disruptions and volatility.
However, DPRP said limited transparency about the actual volume of imported products expected into Nigeria was making effective production and inventory planning increasingly difficult.
According to the refinery, maintaining substantial stock without clear visibility into incoming import volumes creates significant carrying costs and undermines efficient market operations.
“As a responsible energy provider, we have always endeavoured to keep adequate reserves to satisfy local demand at all times. However, in an environment where significant volumes of imported PMS continue to enter the market through licences issued by the regulator, and where there is limited visibility on future import volumes, it becomes commercially unsustainable to continue holding excess inventory indefinitely,” the refinery said.
DPRP explained that products not immediately absorbed by the Nigerian market consequently had to be exported to regional and international destinations to avoid unnecessary storage and financing costs.
It said its export volumes had therefore increased in recent months, not because it lacked the capacity or willingness to supply Nigeria, but because excess inventories arising from uncertainty in the domestic market needed to be evacuated.
The refinery stressed that the increase in exports should not be interpreted as a reduced commitment to Nigeria.
Rather, it described exports as a prudent operational response to a market in which imported petroleum products continued to compete with locally refined fuel despite sufficient domestic production capacity.
DPRP reiterated that it remained ready, willing and able to meet and surpass Nigeria’s petroleum product requirements and was continuing to invest in infrastructure and logistics to ensure reliable supplies nationwide.
It also warned against attributing potential supply shortfalls to the refinery if market distortions caused by excessive importation made it difficult for domestic producers to accurately forecast demand and maintain appropriate inventory levels.
The refinery called for greater transparency and improved coordination in the downstream petroleum market.
It also advocated policies that would support domestic refining, strengthen Nigeria’s energy security, conserve foreign exchange and maximise the economic benefits of investments in local refining capacity.
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