The ongoing public dispute between Dangote Industries Limited and the Nigerian Midstream and Downstream Petroleum Regulatory Agency (NMDPRA) could have a negative impact on Nigeria’s oil and gas sector, which is essential to the continent’s largest economy but has seen too few investments.
BusinessDay reported that half of Nigeria’s daily oil output might be processed by the $20 billion Dangote complex, which is located outside of the commercial hub of Lagos, once it is completely operational.
However, NMDPRA is full of accusations that the refinery’s diesel products are inferior to those that are imported.
In response, Dangote Industries Limited has condemned a report criticising the quality of its products, stating that its diesel is 80% superior to the ones imported from abroad.
A senior source in Nigeriaâs oil and gas sector told BusinessDay,
Luqman Agboola, head of energy and infrastructure at Sofidia Capital said,
He pointed out that the oil and gas industry will be disproportionately affected by any factor that hinders foreign investment, harming participants throughout the value chain and depriving the nation of potentially significant energy transactions.
Investors in the oil and gas industry face significant challenges due to political and regulatory uncertainties, according to Juwon Adebayo, an energy and environmental lawyer with Center for Energy Resources Consulting.
Investors would therefore do a great deal of due diligence before making an investment there to make sure that these risks are sufficiently addressed or reduced.
The regulator’s remarks, according to Charles Ogbeide, an energy expert with an investment bank in Lagos, were careless.
Energy economist Kelvin Emmanuel, a board member of Obsidian Archenar Nigeria, stated that NMDPRA staff have been stationed at the refinery for a period of 12 months in order to inspect and monitor every aspect of the system, from mechanical to electrical.
TimesNow.com.ng reported that the federal government declared that, in addition to the goods produced by the Dangote Petroleum Refinery, it will continue importing refined petroleum products into the nation in order to prevent monopolies and preserve energy security.
It emphasized that over reliance on the $20 billion refinery located in the Lekki Free Zone of Lagos was advised, and that the company’s demand that all oil marketers buy their products from it is a detriment to competition.
The House of Representatives established an ad hoc committee to investigate claims that crude oil was not supplied to the Dangote refinery, following criticism from oil marketers that the International Oil Companies (IOC) operating in Nigeria had failed to supply crude to local refiners.
Proofreading by James, Ojo Adakole, journalist and copy editor at TimesNow.com.ng.
Source: TimesNow.com.ng
