The Nigerian National Petroleum Company (NNPC) Limited has announced that it reduced its stake in the Dangote Petroleum Refinery to 7.2 percent in order to reallocate resources toward investments in Compressed Natural Gas (CNG). Femi Soneye, NNPC’s spokesperson, made this disclosure during an appearance on the Brekete Family program on Monday.
Initially, in September 2021, the NNPC acquired a 20 percent stake in the Dangote Refinery for $2.76 billion. However, as of July 14, Aliko Dangote, Africa’s richest man, revealed that NNPC’s share in the refinery had been reduced to 7.2 percent.
Soneye clarified that the reduction in stake was a strategic move, emphasizing that NNPC remains fully supportive of the Dangote Refinery. He also dismissed rumors of any collaboration between NNPC and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to undermine the refinery’s operations.
“The decision to reduce our stake in the Dangote Refinery was driven by our desire to invest in CNG. We observed that CNG is a cost-effective and cleaner energy alternative, and globally, there is a shift toward such sustainable energy sources,” Soneye explained.
Highlighting the benefits of CNG, Soneye mentioned that if more Nigerians adopt CNG, it would be significantly more affordable for them. “This is why NNPC is actively establishing CNG stations across the country. With just N10,000, Nigerians can fill their cars and run them for two weeks. Given that gas is cheaper in Nigeria, we decided to invest in it, aligning with global trends,” he added.
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Soneye also addressed concerns about the NNPC’s influence over the Dangote Refinery, stressing that the Petroleum Industry Act (PIA) does not grant NNPC the authority to interfere with the refinery’s operations. “We want Nigerians to understand that NNPC has no issues with the Dangote Refinery. We are part owners with a 7.2 percent stake, and we have a vested interest in its success. Sabotaging the refinery would be against our interests,” he assured.
Soneye also provided context regarding the ongoing dispute between the NMDPRA and the Dangote Refinery. He clarified that whenever Farouk Ahmed, CEO of NMDPRA, comments on the refinery, he does so in his capacity as a regulator overseeing all operators in the midstream and downstream sectors, including NNPC.
“Mr. Farouk Ahmed heads the NMDPRA, which holds regulatory authority over all refineries in Nigeria. They oversee everything related to petrol distribution, and in this sector, their authority surpasses that of NNPC. We have no involvement in their regulatory functions,” Soneye noted.
The dispute between NMDPRA and the Dangote Refinery intensified on July 18 when Ahmed claimed that local refineries, including Dangote’s, were producing products of lower quality compared to imports. Ahmed also alleged that Dangote requested a halt to the importation of petroleum products, such as automotive gas oil (AGO) and jet kerosene, directing all oil marketers to source from his refinery. However, Dangote has since denied these claims.
