Business
Dangote Refinery Can Save Nigeria N15tn Import Cost, Generate $11bn FX Inflow Annually – Dele Oye
The Dangote Petroleum Refinery has the capacity to save Nigeria over N15 trillion in fuel import costs and generate an estimated $11 billion in foreign exchange inflows through local refining and petroleum exports per annum.
These are the views of former President of the Nigerian Association of Chambers of Commerce of Industry, Mines and Agriculture (NACCIMA), Dele Oye, who is also the Chairman of the Alliance for Economic Research and Ethics LTD/GTE, expressed in a media statement.
He emphasised that Nigeria continues to incur massive foreign exchange losses due to its dependence on imported refined petroleum products, despite the operational capacity of the Dangote Petroleum Refinery.
The former Chairman of the Organised Private Sector of Nigeria (OPSN) noted that the continued defence of the Nigerian National Petroleum Company Limited (NNPC Ltd) of fuel import licences undermines Nigeria’s drive toward energy self-sufficiency and economic sovereignty.
Oye explained that Nigeria spent approximately N15.42 trillion on petrol imports in 2024, describing the figure as a significant drain on foreign exchange reserves and a structural weakness in the country’s energy architecture.
According to him, the Dangote Refinery has the ability to meet over 90 per cent of Nigeria’s domestic fuel demand and could significantly reduce import dependence if fully integrated into the national supply system.
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Oye further estimated that increased reliance on local refining could save Nigeria up to $11 billion annually in foreign exchange outflows, reducing pressure on the naira and improving macroeconomic stability.
He argued that NNPC’s justification for continued fuel importation on the grounds of maintaining competition is flawed, insisting that it effectively entrenches dependency on foreign refineries while discouraging domestic industrial growth.
“NNPC’s insistence on maintaining import licences for foreign-sourced products while a domestic facility can meet demand is tantamount to penalising the player who built the stadium while rewarding those who merely show up to play,” Oye said.
He maintained that Nigeria’s legal framework, including the Petroleum Industry Act (PIA) 2021 and the Nigerian Oil and Gas Industry Content Development Act, prioritises domestic refining and local value addition, adding that imports are intended only as a short-term measure where local capacity is insufficient.
Besides, Oye questioned the consistency of NNPC’s position, noting that while the company raises concern about monopoly risks from a private refinery, it continues to rely heavily on foreign supply chains for domestic fuel consumption.
He added that sustained fuel importation exposes Nigeria to global price volatility, foreign exchange pressure, and job losses in the domestic economy, while exporting value-added opportunities to foreign refiners and logistics operators.
He further called for a review of import licensing under the PIA, stronger protection for domestic refineries, and fiscal incentives to encourage additional private sector investment in refining infrastructure.
Oye also urged greater transparency in refinery rehabilitation projects and called for accountability in past turnaround maintenance expenditures, arguing that inefficiencies in state-owned refineries have contributed to prolonged import dependence.
He also referenced global models from countries such as Brazil, Saudi Arabia, India and the United States, where domestic refining capacity is protected and supported through targeted industrial policies. According to him, Nigeria risks undermining its industrialisation agenda if it fails to prioritise local refining capacity over import dependence, despite existing domestic production capability.
“The Nigerian National Petroleum Company Limited (NNPC Ltd) has, in recent court filings, accused Dangote Petroleum Refinery, a $20 billion, 650,000 barrels-per-day facility, Africa’s largest single-train refinery, of seeking to monopolise Nigeria’s fuel market. The state oil company’s argument: that restricting fuel import permits would ‘undermine competition and expose Nigeria to supply disruptions, price instability and threats to national energy security’.
“This position, articulated with the gravitas of institutional authority, conceals a devastating truth: NNPC is not defending competition. It is defending importation. It is not protecting energy security. It is perpetuating dependency. And in doing so, it stands in direct contravention of Nigeria’s own laws, the President’s economic agenda, and the hard-won lessons of nations that have successfully industrialized their petroleum sectors.”
“The Dangote Petroleum Refinery represents what is possible when Nigerian capital, vision, and perseverance confront adversity. Built at a cost of approximately $20 billion, the facility processes 650,000 barrels of crude per day, produces up to 53.6 million litres of Premium Motor Spirit (PMS) and 23.6 million litres of Automotive Gas Oil (AGO) daily, has the capacity to meet over 90 per cent of Nigeria’s domestic demand, can save Nigeria between $6–11 billion annually in foreign exchange outflows and is currently exporting jet fuel to European markets, demonstrating global competitiveness.
“It has the capacity to meet 100 per cent of Nigeria’s requirement for all refined liquid products, including petrol, diesel, kerosene and aviation fuel, with surplus volumes available for export, currently exports petrol, diesel and jet fuel across global markets, including Africa, Asia, the Americas and Europe, demonstrating strong international competitiveness,” Oye argued.
He maintained that the NNPC’s litigation against Dangote Refinery using the language of ‘monopoly’ to defend importation is not merely a policy error, but a moral failure.
“It betrays the Nigerian entrepreneur who builds despite crushing interest rates. It betrays the Nigerian worker who could be employed in domestic refining. It betrays the Nigerian taxpayer whose resources are diverted to foreign suppliers. And it betrays the Nigerian future that depends on industrial self-sufficiency.
“The laws are clear. The economics are compelling. The global precedents are overwhelming. What is lacking is not knowledge but political will and the courage to prioritise Nigerian industries over foreign suppliers, Nigerian jobs over foreign profits, and Nigerian sovereignty over convenient dependency,” he added.
According to him, President Bola Tinubu’s economic agenda calls for production over consumption, industrialisation over importation, and sovereignty over subservience, stressing that NNPC must align with this agenda or be reformed until it does.
“The Dangote Refinery is not a monopoly threat. It is a sovereignty achievement. It is proof that Nigerians can build world-class industrial infrastructure when given the opportunity. The task of the government is not to stifle this achievement with import competition but to nurture it with protective policies that other nations take for granted.
“Nigeria does not need to import refined petroleum products. Nigeria needs to refine its own petroleum, by its own people, in its own facilities, for its own benefit. Anything less is a continuation of the colonial economic model that has kept Africa resource-rich but development-poor for generations,” he insisted.
Shell will continue to support Nigeria in its efforts to build a secure energy future through investments and efficient delivery of its businesses in Nigeria.
“We continue to invest in Nigeria’s future through our projects, our people, and our enduring confidence in the potential of this nation,” General Manager, Development and Subsurface Shell Nigeria Deepwater, Kun Jiang said today while delivering the sponsor’s remarks at the 49th edition of the Nigeria Annual International Conference and Exhibition of the Society of Petroleum Engineers in Lagos.
Kun highlighted current investments in Bonga North, HI and the advancement of Bonga Southwest as testimonies of Shell’s confidence in Nigeria’s deepwater future. The confidence was further reiterated with the recent launch of a US$3 billion contract financing programme by Shell Nigeria Exploration and Production Company (SNEPCo), which will help Nigerian contractors build capability, create value, and accelerate project delivery.
Shell is a major sponsor of the conference as part of a longstanding support for a professional body which has contributed to the development of the oil and gas industry. Discussing the theme of the conference; “Thriving in the Evolving Global Energy Landscape: Collaborative Growth and Resilience,” Kun said Nigeria had a lot of opportunities despite geopolitical tensions that threaten global supply chains and market volatility and shifting energy dynamics.
“With a population exceeding 240 million people, abundant natural resources, world-class talent, and growing domestic energy needs, Nigeria has all the ingredients to become one of the world’s most attractive energy investment destination,” she pointed out. “But potential alone does not create prosperity. Potential must be converted into progress. Resources must be transformed into value. Opportunity must be matched by action.”
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Nigeria must continue to attract capital, strengthen the business environment, embrace technology to unlock potentials if it will thrive in the global evolving energy landscape. She added: “The future will belong to countries and industries that combine resilience with innovation, ambition with collaboration and investment with execution excellence. Nigeria has the resources. Nigeria has the talent. Nigeria has the opportunity. What is required now is the collective determination to seize it.”
Shell is mounting an exhibition at the SPE conference with SNEPCo’s Senior Production Geologist Abidemi Belgore taking industry leaders and regulators round the stand.
Key areas of interest include technological breakthroughs that have enhanced output at Bonga and facilitated the execution of the Bonga North project. Also highlighted on the stand is the full range of Shell businesses in Nigeria from deepwater oil production and integrated gas to renewables and power solutions as well as social investments across the country.
The Nigerian naira recorded further gains against the United States dollar on Monday, appreciating to N1,408 per dollar in the parallel market, compared to N1,415/$ recorded at the close of trading last weekend.
The local currency also strengthened in the Nigerian Foreign Exchange Market (NFEM), where it appreciated to N1,365 per dollar, up from N1,368/$ at the end of last week.
According to data released by the Central Bank of Nigeria (CBN), the indicative exchange rate improved by N3, reflecting sustained appreciation of the naira in the official market.
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The latest gains also narrowed the gap between the parallel and official exchange rates to N43 per dollar, down from N47 per dollar recorded on Friday, indicating a gradual convergence between both markets.
Meanwhile, activity in the official foreign exchange market increased significantly, with interbank turnover surging by 132.3 per cent to N137.05 million, compared to N58.99 million recorded last weekend.
The improved performance of the naira across both markets comes amid continued efforts by monetary authorities to stabilise the foreign exchange market and enhance liquidity.
With a view to improving operational efficiency, safety, compliance and service delivery across its operations, Pinnacle Oil & Gas Limited has reaffirmed commitment to building stronger relationships with its vendors.
The company made the commitment at its 2026 Vendors’ Forum held in Lagos under the theme, “Partnering for Operational Excellence,” with the sub-theme, “Strengthening Partnerships Through Compliance, Safety, Performance and Innovation.”
The forum brought together more than 100 existing and prospective vendors as well as key stakeholders, both physically and virtually, to strengthen collaboration and align suppliers with the company’s operational standards and growth strategy.
Speaking at the event, Managing Director and Chief Executive Officer of Pinnacle Oil & Gas, Adenike Labinjo, described vendors as strategic partners whose commitment to quality, innovation, safety and compliance is critical to the company’s success.
She said as Pinnacle continues to expand its operations, it has become increasingly important for the company and its vendors to share a common understanding of expectations, responsibilities and performance standards.
Labinjo stressed that safety, regulatory compliance and ethical business practices remain non-negotiable in all engagements with suppliers.
She noted that stronger collaboration with vendors would help the company deliver greater value to customers and other stakeholders while supporting sustainable business growth.
The forum featured technical presentations by senior executives from the company’s Procurement, Engineering, Compliance, Finance, Legal, Health, Safety and Environment (HSE), and Sales and Marketing departments.
Participants received guidance on Pinnacle’s procurement procedures, vendor onboarding and prequalification processes, Know Your Customer (KYC) requirements, tax invoicing, payment processes, contractual obligations, technical specifications, contractor responsibilities, supplier performance expectations and Service Level Agreements.
The company also unveiled improvements to its Purchase Order (PO) process aimed at improving efficiency, transparency and ease of doing business with vendors.
A major highlight of the event was an interactive question-and-answer session where vendors engaged directly with the company’s leadership on procurement procedures, compliance requirements, project execution, HSE standards and areas for continuous improvement.
According to Pinnacle, the session reinforced its commitment to transparency, open communication and stronger collaboration with suppliers.
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The company also recognised outstanding vendors whose contributions have supported its operational performance over the past year. Five companies received Certificates of Recognition for exceptional service delivery, innovation and partnership.
The award recipients were Great Grace Enterprise for Outstanding Delivery Performance, Cevets Nigeria Limited for Excellence in Project Delivery, Ceezik Projekts for Outstanding Quality, Diadco Nigeria Limited for Outstanding Responsiveness, and Sephill Innovative Solutions Limited for Best Commercial Value.
On the significance of the forum, Head of Procurement and Administration, Oluseyi Ogunfowora, said the initiative reflects Pinnacle’s determination to build stronger partnerships through transparency, collaboration and shared accountability.
She explained that the procurement function coordinates the requirements of Engineering, Operations, Marine, Compliance, Legal, Finance, HSE and other business units to ensure a fair, efficient and transparent procurement process.
Ogunfowora urged vendors to submit complete and compliant documentation, communicate proactively and seek clarification whenever necessary.
“The success of our business depends on the strength of our partnerships,” she said. “When vendors clearly understand our expectations and we work together with transparency, compliance and open communication, we create a high-performing vendor ecosystem that benefits everyone.”
She added that the 2026 Vendors’ Forum forms part of Pinnacle’s broader strategy to strengthen supplier engagement, improve operational efficiency and reinforce a culture of compliance, safety, innovation and continuous improvement throughout its value chain.
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