The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has announced that the Dangote Refinery is set to begin the distribution of Premium Motor Spirit (PMS) to the Nigerian National Petroleum Corporation (NNPC) starting this Sunday September 15th 2024. This announcement was made by Dr. Zacch Adedeji, Executive Chairman of the Federal Inland Revenue Service (FIRS), during a press briefing held in Abuja on Friday.
Edun highlighted that all necessary agreements have been finalized, and the initial shipment of PMS from the Dangote Refinery is ready for distribution. Starting October 1, NNPC Ltd. will begin supplying approximately 385,000 barrels per day (kbpd) of crude oil to the Dangote Refinery, with payments to be made in Naira. In exchange, the refinery will provide PMS and diesel of equivalent value to the domestic market, also payable in Naira.
“Diesel will be available for purchase in Naira by any interested buyer. However, PMS will be exclusively sold to NNPC, which will then distribute it through various marketers,” Edun stated. He also noted that all regulatory costs, including those from the Nigerian Ports Authority (NPA) and the Nigerian Maritime Administration and Safety Agency (NIMASA), will be settled in Naira.
Plans are underway to establish a centralized coordination hub at the NPA in Lagos. This hub will streamline services from regulatory and security agencies, as well as other stakeholders, to facilitate the smooth implementation of this initiative. Over the next three to six months, the technical committee responsible for developing the initiative will transition into an implementation, execution, and monitoring committee based in Lagos.
Edun further revealed that the Federal Executive Council (FEC), chaired by President Bola Tinubu, has authorized the sale of crude oil to local refineries and the purchase of petroleum products to be conducted in Naira. This policy aims to alleviate pressure on the Naira, reduce transaction costs, and enhance the availability of petroleum products in the country.
The FEC’s approval, in conjunction with collaborative efforts from NNPCL and Dangote Refinery, has finalized the operational framework for this new arrangement.
