Dangote Refinery Halts Petrol Sale To Importers Over Alleged Blending

The Dangote Petroleum Refinery has stopped the sale of Premium Motor Spirit (PMS) to major marketers importing petroleum products into Nigeria.

An official of the refinery confirmed this, saying the refinery would no longer sell petrol to those blending Dangote fuel with imported grades.

“We are not selling petrol to those who are importing, since they are trying to blend our high-quality products with their ultra-low-quality imported products,” the source said, pleading anonymity because he was not authorised to speak with the press.

Another source said the refinery now prefers to sell its petrol to members of the Independent Petroleum Marketers Association of Nigeria (IPMAN) and others not known for importing. “We are selling to independent marketers and others who are not importing,” he stated.

The development is said to be why some marketers went to court to get an order that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) should continue to grant them import licences.

The marketers feared they might be left stranded if they could not import fuel at a time when the Dangote refinery had halted petrol sales to them. Dangote had earlier threatened to stop transacting business with fuel importers, whom it accused of blending its Euro-5 petrol grade with imported grades.

It said it was concerned that such practices could make it difficult to distinguish between products supplied directly by the refinery and products subsequently blended or handled by third parties.

“It is difficult to understand why we would invest heavily in producing high-quality petroleum products for Nigerians, only for those products to be mixed with imported products of uncertain quality and the resulting product to be associated with the refinery,” the refinery said last month.

Reacting, importers and petroleum marketers kicked against the restriction, describing the move as an attempt to block imports. The marketers also challenged the refinery to provide evidence that imported petrol entering the Nigerian market is below the required quality standard.

“We know what Dangote is trying to do. He is just trying to block imports,” one of the marketers said, preferring anonymity. The marketer argued that a company that sells petrol could not dictate whether a consumer should combine its product with fuel purchased from another supplier.

“For example, when you buy petrol from a TotalEnergies station, and you go down the road, and your petrol is almost finished, you then buy from MRS. Can TotalEnergies say you should not mix its petrol with MRS petrol? No, it can’t. I don’t understand the game that the Dangote refinery is playing,” he stated.

Another marketer argued that the Federal Government had a responsibility to ensure adequate petrol supply and protect consumers, insisting that imports remain necessary when domestic production drops.

Speaking, the National Vice Chairman of IPMAN, Hamed Fashola, said the refinery is selective about who it sells to because not all major marketers import.

“I don’t know how far that is correct; Dangote now sells to only IPMAN. I think somehow the information I have is that Dangote is selective about it, say those that are involved in importing. I think it’s not everybody that is importing,” he said.

Clarifying IPMAN’s position, Fashola noted that independent marketers operate flexibly to secure the most competitive pricing, sourcing supply from both local refineries and importers.

“We buy our product anywhere we feel it is cheap. Anywhere we see the product, we go for it, both Dangote and the importers. We always go for the best price,” he stated.

Meanwhile, the National Publicity Secretary of IPMAN, Chinedu Ukadike, expressed the belief that the refinery is open to doing business with anyone.

He noted that independent marketers are ready to buy and sell petrol from all suppliers, stressing that they were not currently involved in importing the product.

“I believe that the Dangote refinery is open for business and that it will continue to sell to marketers. The issue of blending, I cannot say yes or no, because I’m not part of those who are importing. Independent marketers are not importing yet; we are just marketers who buy and sell.

“So, if there is any measure to discourage adulteration of petroleum products by Dangote, I think the refinery and its experts know best. They know the best way to deal with that. But our own is to continue to buy and sell to marketers. If there is a way to discourage adulteration of petroleum products, I won’t stop Dangote from doing so,” Ukadike added.