Video - Central Bank of Nigeria halts extensions for export proceeds repatriation

The bank says no extensions will be accorded anymore for the repatriation of exports proceeds, in compliance with Nigeria's foreign exchange regulations. Non-oil export proceeds have a 180-day window for repatriation while oil and gas proceeds have a 90-day deadline.

CGTN

Nigeria nears crude oil production quota as per OPEC guidelines

Nigeria came close to meeting its OPEC-regulated crude oil production target in December, averaging 1.48 million barrels per day, just short of the 1.5 million barrels per day quota. The figure however still maintained Nigeria as Africa’s largest producer.

CGTN

Nigeria experts call for reforms in oil, gas

They made the at a one-day symposium themed “Nigeria Petroleum Industry: The Way Forward,” organised by Classmasters in collaboration with other partners.

The symposium focused on addressing the social, economic, and environmental challenges affecting the sector central to Nigeria’s economy for nearly seven decades.

Speaking to journalists at the sideline interview of the symposium, the Managing Director of Classmasters Limited, publishers of Development Agenda Magazine, Paddy Ezeala, called for collaboration and innovative solutions to tackle the oil and gas sector challenges.

He said, “We aim to ensure that all stakeholders understand the complexities of this industry and collaboratively create a path forward that meets global standards.

“This industry is vital to our economy and national identity. For decades, we have failed to harness its potential fully. There is an urgent need for reforms and a unified strategy.

“The Petroleum Industry Act (PIA) was a significant topic of discussion. Attendees advocated for amendments to address the diverse interests of stakeholders, including environmentalists, host communities, local operators, and international firms.

“No document is flawless, but this symposium aims to generate actionable recommendations to drive meaningful progress.”

Ezeala explained the event’s distinctiveness and strong support from key industry players, including NNPC Limited (NNPCL).

“Unlike previous gatherings, the outcomes of this symposium will not be ignored. As an environmentalist, I strongly advocate for mandatory environmental responsibility from all oil companies,” he added.

Participants expressed optimism about producing a comprehensive and actionable document to address critical issues such as energy transition, environmental sustainability, and socioeconomic challenges in the oil and gas industry.

For his part, Dr Oshita Oshita, the Executive Director of the Ubuntu Centre for Africa Peacebuilding and Development (UCAP), highlighted the growing security challenges in oil-producing areas.

“The Niger Delta faces evolving security threats that are deeply tied to the dynamics of oil production. Many underlying factors do not make it to the public domain but significantly impact the security landscape,” he remarked.

Oshita also underscored the link between Nigeria’s dependence on oil, often called the “Dutch disease,” and the neglect of oil-bearing communities. “The Niger Delta, despite being the source of the country’s oil wealth, remains one of the most underdeveloped areas. The people of this region see little to no benefit from the resources extracted from their land, fueling resentment and security crises. As long as these grievances persist, the challenges will remain.”

He argued that implementing the Petroleum Industry Act (PIA) presents a unique opportunity to address these issues.

“The PIA offers several opportunities that can be leveraged to transform oil-bearing communities and surrounding businesses. While the Act has its challenges, its potential to create a more equitable and sustainable industry cannot be overstated,” he said.

Oshita’s paper highlights the often-overlooked aspects of oil production, which significantly impact the security landscape.

He attributes the country’s struggles to the “Dutch disease,” which has led to an over-reliance on oil, neglecting other sectors of the economy.

A major concern is the lack of benefits for communities in oil-producing areas. This has led to ongoing security challenges, as people fight for their land and resources. Oshita proposes that Nigeria can overcome these challenges by leveraging opportunities presented by the Petroleum Industry Act (PIA).

Despite criticisms that Nigeria is not in control of its petroleum industry, Oshita believes that following the PIA’s guidelines can help the country regain control.

He stressed the need for stakeholders to focus on getting the benefits of the PIA, which can positively impact communities, oil-bearing communities, and surrounding businesses.

IPPMEDIA

Dangote Refinery Retained 13% of Nigeria’s Crude Exports in 2024

The Dangote Refinery retained 13% of Nigeria’s crude oil exports in 2024, marking a significant increase from just 2% in 2023, according to Reuters. This shift helped to reduce Nigeria’s exports to Europe while boosting the country’s domestic share of oil supply.

Despite being a major net exporter of crude, Nigeria still imported 47,000 barrels per day of US oil in 2024, a move that experts find unusual for an oil-exporting country. The Dangote refinery, with a capacity of 600,000 barrels per day, played a key role in this trend, receiving multiple shipments of US West Texas Intermediate (WTI) oil due to the Nigerian National Petroleum Company’s failure to meet its supply needs.

The year also saw global crude exports decline by 2% due to weak demand and the reshuffling of trade routes. Conflicts in Ukraine and the Middle East, along with sanctions on Russian and Iranian oil, caused significant shifts in global oil supply chains, influencing both exports and imports.

As the global oil market faces continued uncertainty, particularly in 2025, experts predict a rise in demand from India, while some countries are increasingly turning to gas and renewable energy sources.

By Abdullahi Jimoh, News Central

Related story: Nigeria's richest man Aliko Dangote takes on the 'oil mafia'

Nigeria requires oil licence applicants to demonstrate low carbon emissions

Nigeria has announced a new policy that will require applicants for oil licences and permits to demonstrate evidence of low carbon emissions and a renewable energy programme, the head of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has stated.

The policy aligns with the country's commitment to achieving net zero carbon emissions by 2060.

NUPRC has introduced the Upstream Petroleum Decarbonisation Template to guide applicants in meeting the new requirements.

NUPRC chief executive Gbenga Komolafe stated that the policy aims to ensure compliance with environmental goals.

The enforcement begins from 1 January 2025 and will apply to all approvals within the upstream sector, including divestments.

Komolafe said: "By this, the commission is deepening its efforts to align the upstream petroleum industry with national priorities and international climate goals while ensuring sustainable value creation from oil and gas resources for Nigeria's energy security and economic development."

The initiative is a step towards a more sustainable and environmentally responsible oil sector.

Operators will be mandated to implement methane management programmes, which include leak detection and repairs.

They will also be required to optimise operations with energy-efficient technologies and incorporate renewable energy sources into their projects.

The directive is part of Nigeria's broader strategy to reduce its carbon footprint and promote sustainability in the oil industry.

Nigeria recently partially resumed operations at the Warri oil refinery after a decade, following a rehabilitation effort that has cost $898m since 2021.

The refinery, with a capacity of 125,000 barrels per day (bpd), had been shut down since 2015 due to disrepair and crude shortages but is now operational at 60% capacity.

In December 2024, Nigeria's Dangote Refinery made its first petrol export to Cameroon, a step that could help stabilise fuel prices across the region.

The 650,000 barrels per day facility, located in Lagos' Lekki Free Zone, marks a key milestone in regional energy integration.

"Nigeria requires oil licence applicants to demonstrate low carbon emissions" was originally created and published by Offshore Technology, a GlobalData owned brand.

Global Data

Nigeria restarts Warri refinery operations after 10 years

Nigeria has announced the partial resumption of operations at the Warri oil refinery, reducing the country's reliance on imported fuel.

The 125,000 barrel-per-day (bpd) refinery, which was shut down in 2015 due to disrepair and crude shortages, is now operating at 60% capacity, according to a statement from presidential spokesperson Bayo Onanuga.

Now operating at 60% capacity, the facility is part of the government's commitment to revitalise its refining sector, plagued by years of neglect and mismanagement.

"This plant is running. We have not completed 100%," Mele Kyari, head of the state oil firm NNPC, said during a tour of the facility with government officials, regulators and journalists.

The refinery, currently undergoing rehabilitation since 2021 at a cost of $898m, will focus on producing straight-run kerosene, diesel, and naphtha, the Nigerian presidency said in an emailed statement.

Nigeria's refining infrastructure comprises four state-owned refineries with a combined capacity of 445,000bpd. These include the 110,000bpd Kaduna plant and three units in the Niger Delta, all of which have been non-operational for years, reported Reuters.

Last month, the Nigerian National Petroleum Corporation (NNPC) reported the restart of the 60,000 bpd Port Harcourt refinery, aiming to revive all four facilities this year.

This month, Nigeria's Dangote Refinery exported its first petrol shipment to Cameroon. This development could contribute to stabilising fuel prices across the region.

The Dangote Refinery, located in the Lekki Free Zone in Lagos, has a production capacity of 650,000 barrels per day (bpd).

"Nigeria restarts Warri refinery operations after 10 years" was originally created and published by Offshore Technology, a GlobalData owned brand.

Global Data

Nigeria steps up crackdown on oil theft as it targets 3 million bpd production

Nigeria has stepped up its drive to crack down on oil theft in the Niger Delta region as it aims to increase national production to 3 million barrels per day in 2025.

Africa's top oil producer, which relies on the commodity for around two-thirds of state revenue and more than 90% of foreign currency earnings, has been hit by large-scale oil theft that has curbed government finances in recent years.

While the government estimates oil output at around 2.06 million barrels per day (bpd) in next year's budget, actual production hovers around 1.8 million bpd, according to official figures.

The operation to crack down on oil theft, code-named Delta Sanity (OPDS), was launched last year by the petroleum ministry and the Nigerian navy. Chief of Naval Staff Emmanuel Ogalla said OPDS has now been bolstered in a second phase with armed drones, attack helicopters, increased intelligence and other reinforcements which could push up oil production above the budget estimate to 3 million bpd.

"If you look at where we were last year, when we launched this operation, we were about 1.4 million bpd. We have now gone to 1.8 million.

"I believe that with all the assets that we are bringing on board, we are definitely going to meet that target and surpass it," Ogalla said in a statement on Tuesday after the operation's flag-off in the southern oil hub of Port Harcourt in Rivers state.

Junior oil minister Heineken Lokpobiri said Nigeria's average daily oil output was only a little above 1 million bpd when he came into office in August 2023.

"Our target is to reach 3 million bpd by 2025 and we are confident that the second phase of OPDS will play a key role in achieving this milestone."

Last month, Rivers State Government donated six gunboats to the Navy to boost its operation against oil theft in the region.

By Camillus Eboh, Reuters

Related story: A plan to win the war against oil theft in Nigeria

A plan to win the war against oil theft in Nigeria

At dawn, the dense creeks and swamps of the Niger Delta are enveloped in an eerie silence, which is interrupted only by the intermittent chirping of Herons, a rare water bird found in this part of Nigeria.

Suddenly, in a flash, the water bubbles and convulses, announcing the galloping approach of speedboats.

The boats usually carry heavily armed militiamen, often clad in work overalls, suggesting they are technicians, said Tonye Francis, who lives in the oil-producing Ogu-Bolo community in Rivers State that’s been in the shadow of an oil conflict for years.

Also in the boats are several dozen empty mini-drums with hoses attached to the bases, that get connected to a nearby oil pipeline after it has been professionally ruptured, the young man told Al Jazeera.

In no time, the mini-drums get filled with crude oil and loaded into barges. The barges, escorted by speedboats, then make their way out of the inlet – crisscrossing other dense creeks and swamps that dot the area – heading in the direction of a waiting foreign vessel, nautical miles away.

“It feels like a movie scene when these activities are going on,” Francis said.

“They [the oil thieves] operate unhindered. Sometimes, those involved are given security cover by their sponsors.”

For years, incidents like this one have become common in Rivers State, which prides itself as Nigeria’s oil capital. But the scene is also a recurring one across the Niger Delta as thieves try to siphon crude from oil pipelines crisscrossing the region.

“We can’t stop them without the support of the military men deployed to the area,” Francis said.

Nigeria is one of Africa’s leading oil exporters. But the industrial-scale oil theft has posed a major threat to communities and the wider economy. Oil theft costs Nigeria millions of dollars each month; about $23bn in oil revenue was lost in 2022 – one of the highest in recent years.

This forced Nigeria to slip as the continent’s largest exporter, according to figures from the Organisation of the Petroleum Exporting Countries (OPEC).

But it appears to be bouncing back and authorities hope improved security measures to help tackle criminals will let them win the war against oil theft for good.

‘Oil theft is a big problem’

Rivers is one of the six states hosting oil installations in the country.

As part of a plan to boost the region’s oil production, authorities in the state last week unveiled a batch of military-grade gunboats to help crack down on criminality and oil theft.

Speaking to Al Jazeera, State Governor Siminalayi Fubara explained that “oil theft is a big problem that needs all hands on deck to tackle it.”

“These six gunboats donated by my government are meant to support the Nigerian Navy to ensure we drastically reduce the activities of oil thieves,” he said.

The gunboats will enhance waterway patrols and response times, especially near submerged oil export pipelines that are prone to attacks, officials said.

“We have set up local vigilantes to support the protection of oil facilities, acquired gunboats, and [are] protecting the ecosystem of the region,” Fubara added.

Rivers is home to pipelines that transport crude from other states to its Bonny export terminal, accounting for 6.5 percent of Nigeria’s entire revenue.

But for decades, theft has impacted negatively on the overall revenue of a country where about 90 percent of government earnings are generated from oil.

Thousands of oil spill incidents have occurred since oil was discovered in commercial quantities in Nigeria in 1958 – due to the activities of oil thieves. The dip in production often has adverse effects on government revenue.

This has continued to affect the people of the communities in these oil-rich areas. Those who depend on farming and fishing have felt a direct effect on their livelihoods and residents have reported numerous health issues.

To provide alternative opportunities for young people, Rivers State government plans to invest more in health, education and infrastructure in areas at risk of pipeline vandalism.

“We are doing our best to discourage any form of economic sabotage,” Fubara told Al Jazeera, “which is why the country’s output has increased in recent months given our support and protection of pipelines.”

‘Recent gains can be sustained’

Oil export is Nigeria’s mainstay as crude production and now averages 1.8 million barrels per day compared with 1.3 million (bpd) in March, though the country has the capability to export close to 2 million bpd.

The group chief executive officer of the state-run Nigerian National Petroleum Company, Mele Kyari, has attributed the increased production to improved security measures and the support of joint venture partners.

“We have reached a new peak in production that we haven’t seen in the last three years. This is related to the sustained efforts by the armed forces and other security agencies to protect our critical assets,” Kyari said in Nigeria’s capital, Abuja.

“I call for enhanced and sustained security engagement.”

Industry experts are optimistic the country’s oil output will peak in a few months if the measures in place are sustained.

“There’s every need to ramp up crude oil production above the current success numbers to help Nigeria defend a fast-falling naira and tackle the insufficient forex supply that has hit the exchange market so hard as the ripple-effect is felt on raising the cost of goods and services as citizens battles to curb the hard realities,” economist Steve Nwachukwu of Steward Asset Management told Al Jazeera.

Nigeria has been struggling with soaring inflation and a sharply devalued currency since President Bola Tinubu introduced reforms more than a year ago aimed at reviving the economy.

Recently, labour leaders and civil society led antigovernment demonstrations to voice discontent over government reforms they say have triggered high inflation.

The country’s inflation rate rose to 34.60 percent in November due largely to soaring food prices and an increase in the pump price of petroleum products, according to figures released by the National Bureau of Statistics.

The federal government has maintained that this phase of the economic crisis is temporary and expects the increase in oil production to boost revenue.

“The recent gains can be sustained if deliberate actions are taken to curb oil theft and encourage IOC’s [international oil companies] and others to increase their investment and commitment,” Nwachukwu said.

‘A total reorientation’

For the governor of Rivers State, more effort is needed to discourage oil thieves.

“We are committed to the government’s remediation of the polluted environment. That is why we are increasing support to other economic sectors like agriculture to tackle poverty which is one of the major reasons the people break pipelines to steal oil,” Fubara said.

“What we need is a total reorientation of the people to discourage them from stealing oil. It’s a bad situation because you have children as young as 14 and 15 involved,” he added.

Pollution from the activities of oil thieves continues to endanger the lives of the 30 million residents of the Delta. Between 2011 and 2021, there were 9,870 spill incidents, according to data from the National Oil Spill Detection and Response Agency (NOSDRA).

These spills are mostly caused by oil thieves and most communities can no longer engage in agriculture as their livelihoods have been destroyed.

In the early 2000s, Niger Deltan youths, aggrieved by the economic marginalisation and environmental degradation of the region, banded together into armed groups, destroyed oil pipelines, and abducted oil companies’ employees. These attacks reduced oil production significantly, costing Nigeria a fifth of its production.

A presidential amnesty was granted with unconditional pardons and gave cash payments to rebels who agreed to turn in their arms.

In recent years, armed struggle in the Delta has been assuaged partly because of surveillance deals granted to some former rebel leaders after the amnesty deal.

Nigeria’s oil minister, Heineken Lokpobiri, admitted the war against oil theft was a tough fight, but insisted the country was winning.

“Everybody knows that oil theft is one of the biggest economic problems that we have. And we are battling them,” Lokpobiri told journalists in Abuja.

“We are not where we want to be. But certainly, it’s a tremendous improvement as far as the issue of oil theft is concerned. We will continue to battle until we get to 2 million, 2.5 million barrels,” according to the minister.

In 2022, Nigeria lost its top spot among oil-producing African countries and fell behind Angola, Algeria, and Libya. But it bounced back this year, retaining its spot as the continent’s leading exporter, according to OPEC figures released in April.

“[This] will greatly relieve the naira and stabilise the exchange market, which will in turn significantly reduce the cost of goods and services as the high exchange rate is the major contributing factor to high input cost for businesses and manufacturers,” economist Nwachukwu said.

By Fidelis Mbah, Al Jazeera

Related story: Rivers state pledges gunboats to navy in fight against oil theft in Nigeria

Shell invests in Bonga North deep-water project in Nigeria

Shell said on Monday its Nigerian subsidiary has announced a final investment decision (FID) on Bonga North, a deep-water project off the coast of Nigeria.

The project, which will help maintain oil and gas production at Bonga, will be connected to Shell's Floating Production Storage and Offloading (FPSO) facility, where the oil major holds a 55% stake.

Shell said Bonga North has an estimated recoverable resource volume of more than 300 million barrels of oil equivalent (boe) and will reach peak production of 110,000 barrels of oil per day (boepd), with first oil expected by the end of the decade.

Reuters

Dangote Refinery in Nigeria makes first petrol export to Cameroon

Nigeria's Dangote Refinery said on Wednesday it has made its first export of petrol to Cameroon, a milestone that could pave way for regional energy integration and help stabilise fuel prices across the region.

The 650,000 barrel refinery built by Nigerian billionaire Aliko Dangote in Lagos aims to compete with European refiners when operating at full capacity and is expected to change trading of refined products in the Atlantic basin.

The company did not provide details of how much was exported.

Cameroon's energy firm Neptune Oil said in the statement that both companies were exploring new initiatives to establish a reliable supply chain that will help stabilize fuel prices and opportunities across the region.

Neptune Oil said the petrol supply transaction was executed without intermediaries.

Reuters

Equinor exits Nigeria

Equinor has closed the planned sale of its assets in Nigeria and Azerbaijan for a total consideration of up to $2 billion, completing exits from the two countries after some 30 years, the Norwegian oil and gas firm said on Monday.

The divestments, first announced in 2023 and completed in recent weeks, will boost cash flow in the fourth quarter and were in line with Equinor's strategy to optimise its international portfolio, the group said in a statement.

"The exits enable investments to deepen further in countries where Equinor can add the most value and build a more focused and robust international portfolio," the company said without elaborating.
Equinor has previously said it plans to increase its international output by some 100,000 barrels of oil equivalent per day (boed) by 2030 by bringing on stream new fields in Brazil, Britain and the United States.

In Nigeria, Equinor sold its assets, including a 20.21% stake in the Agbami oil field operated by Chevron, to Chappal Energies for up to $1.2 billion, consisting of $710 million in cash and the remainder in contingent payments.

The company did not say how market prices and other factors could affect contingent payments.

In Azerbaijan it sold a 7.27% stake in the Azeri Chirag Gunashli (ACG) field, a 8.71% stake in the Baku-Tbilisi-Ceyhan (BTC) oil pipeline and a 50% stake in the Karabagh project to Azerbaijan's SOCAR and India's ONGC for a total of $745 million.

Equinor's net production in Azerbaijan and Nigeria averaged 24,600 and 17,700 barrels of oil equivalent per day (boed), respectively, during the first three quarters of 2024. 

Reuters

Video - Port Harcourt and Dangote refineries expected to help meet local consumption needs

Nigeria's state-owned Port Harcourt refinery is finally back up and running. It is hoped that, along with recent launch of the privately-owned Dangote refinery, Nigeria will soon be able to supply the petrol products needed domestically while positioning Nigeria as a petroleum product exporter.

CGTN

Related story: Nigeria's richest man Aliko Dangote takes on the 'oil mafia'

 

Dangote Plant Buys US Oil for First Time in 3 Months

Nigeria’s giant Dangote refinery purchased its first shipment of US oil after a hiatus of three months as the site continues to ramp up production.

The plant purchased about two million barrels of WTI Midland crude from Chevron Corp., according to people with knowledge of the transaction who asked not to be identified because the matter is private. The cargo is due to be delivered to the refinery near Lagos next month.

Earlier this year, Dangote was typically receiving one or two supertankers of US crude every month alongside domestic supplies. But the flows waned in the summer as the refinery switched to taking more local output, amid an agreement to take up to 400,000 barrels a day of Nigerian crude paid for in local currency.

Dangote is taking a growing role in US and European oil markets, after gradually raising purchases of crude from Nigeria and the US. The plant’s pull on those barrels increases the competition for the oil faced by traditional buyers in Europe.

Chevron booked the supertanker Azure Nova to load crude from the US Gulf around Dec. 5 to Dangote, according to tanker fixtures seen by Bloomberg. It wasn’t clear why the refinery had returned to purchasing US barrels. Earlier this week though, Sparta Commodities said in a note that cheaper shipping costs were the main factor in WTI Midland landing cheaply into Europe recently.

The refinery is also beginning to shake up regional fuel markets, hauling gasoline beyond Nigeria’s borders to Togo earlier this month. 

By Sherry Su and Bill Lehane, Bloomberg

Nigeria's richest man Aliko Dangote takes on the 'oil mafia'

Petrol production at Nigerian business tycoon Aliko Dangote’s $20bn (£15.5bn) state-of-the-art oil refinery ought to be some of the best business news Nigeria has had in years.

But many Nigerians will judge its success on two key questions - firstly: "Will I get cheaper petrol?"

Sorry, but probably no - unless the international price of crude drops.

And secondly: "Will I still have to spend hours watching my hair turn grey in a hypertension-inducing fuel queue?"

Hopefully those days are gone but it might partly depend on the behaviour of what Mr Dangote calls "the oil mafia".

For much of the time since oil was first discovered in Nigeria in 1956, the downstream sector, which includes the stage when crude is refined into petrol and other products, has been a cesspit of shady deals with successive governments heavily involved.

It has always been impossible to follow the money, but you know there is something dreadfully wrong when the headline "Nigeria’s state-owned oil firm fails to pay $16bn in oil revenues", pops up on your news feed, as it did in 2016.

It is only in the last five years that the state-owned Nigerian National Petroleum Company (NNPC) has been publishing accounts.

The Africa head at the Eurasia Group think-tank, Amaka Anku, hails the Dangote refinery, in which the NNPC has a 7% stake, as "a very significant moment" for the West African state.

"What you had in the downstream sector was an inefficient, corrupt monopoly," she says.

"What the local refinery allows you to do is have a truly competitive downstream sector with multiple players who will be more efficient, profit making and they’ll pay taxes."

To put it bluntly, the population of this oil-rich nation has been conned on a colossal scale for many years.

Oil revenue accounts for nearly 90% of Nigeria’s export earnings but a relatively small number of business people and politicians have gorged themselves on the oil wealth.

Aspects of the business model have been baffling, including that of Nigeria’s four previously existing oil refineries.

Built in the 1960s, 70s and 80s, they have fallen into disrepair.

Last year Nigeria’s parliament reported that over the previous decade the state had spent a staggering $25bn trying and failing to fix the moribund facilities.

So Africa’s largest oil producer has been exporting its crude which is then refined abroad, much to the delight of some well-connected traders.

It would be like a bakery with a broken oven. But rather than fix it, the owner sends balls of dough to another firm that shoves them in a working oven and sells the loaves back to the baker.

The NNPC swaps Nigeria’s crude oil for the refined products, including petrol, which are shipped back home.

Exactly how much money changes hands and who benefits from these "oil swaps" is just one of the unknowns in these deals.

"No-one has been able to nail down who exactly has benefited. It’s almost like a beer parlour gossip about who is getting what," says Toyin Akinosho of the Africa Oil+Gas Report.

The NNPC began subsidising the price of petrol in the 1970s to cushion the blow when global prices soared. Every year it clawed this money back by depositing lower royalty payments - the money it received for every barrel pumped out of the ground - with the Nigerian treasury.

In 2022 the subsidy cost the government $10bn, more than 40% of the total money it collected in taxes.

On his second day in office Nigeria’s Vice-President Kashim Shettima referred to "the fuel subsidy scam" being "an albatross around the neck of the economy".

Nigerian oil expert Kelvin Emmanuel says in 2019 the country’s official petrol consumption "jumped by 284% to 70m litres per day without empirical evidence to justify such a sharp increase in demand".

Parliament has previously reported that - at least on paper - importers were being paid to bring in far more petrol than the country consumed. There was a lot of money to be made exporting some of the subsidised petrol to neighbouring countries where prices were far higher.

The NNPC earned billions of dollars a year from the crude oil production. But for many years, under previous governments, some of its profits never reached the treasury as it was accused by state governors and federal lawmakers of including these inflated subsidy costs on its balance sheet.

The NNPC did not respond to a request for an interview or a response to these allegations but in June denied it had ever "inflated its subsidy claims with the federal government".

It may have been the main source of revenue for successive governments but for decades, until 2020, the board did not disclose its audited accounts. Its press release from March this year promised more transparency and accountability.

After coming to power in May 2023, President Bola Tinubu said the subsidy was unsustainable and suddenly cut it - pump prices immediately tripled.

He also stopped the policy of artificially propping up the value of the local currency, the naira, and let market forces determine its value.

When he took over, the exchange rate was 460 naira to the US dollar. In November 2024 it was over 1,600.

The triple shock of higher fuel prices, sporadic shortages of supply and a depreciating currency has been a tough body blow for people across the country, many of whom are forced to run generators to keep the lights on and phones charged.

"Beyond the financial burden, the uncertainty and stress of constantly dealing with fuel shortages have added a layer of anxiety to everyday tasks," is how one Lagos resident summed it up.

"I feel like I’m always navigating through crisis mode. It’s exhausting."

As the naira plunged and pump prices increased several times, the government, aware of the potential danger of protests, continued to pipette some medicine to the masses.

In a move which could be likened to swallowing half a paracetamol for acute appendicitis, the government made sure people were paying slightly less than the market rate for a litre of petrol.

In other words, the NNPC was selling at a loss and the subsidy was still alive.

But with two recent increases in October, Nigerians are now paying market prices for fuel for the first time in three decades. In the main city Lagos it went up from 858 naira ($0.52) to 1,025 naira per litre.

One of the major factors in Nigeria’s economic crisis has been a limited supply of foreign currency. The country does not export enough products and services to bring in the dollars.

But lots of people, including fuel traders, have been chasing the same limited supply of foreign currency, which leads to the naira losing even more value.

The good news is that Mr Dangote’s facility is going to buy crude and sell refined fuels in Nigeria in the local currency, which will leave more dollars available for everyone else.

The bad news for those hoping this will mean cheaper fuel is that the price Mr Dangote pays for a barrel of local crude will still be the naira equivalent of the international cost in dollars.

So if the price of crude goes up on the world market, Nigerians will still be forced to fork out more naira. Refining locally will mean less freight costs but that’s a relatively small saving.

It is hoped that the arrival of Mr Dangote’s oil refinery will help bring a measure of transparency to the sector.

He knew he would be upsetting some of those who benefit from the murky status quo when the $20bn project began. But, he says, he underestimated the challenge.

"I knew there would be a fight. But I didn’t know that the mafia in oil, they are stronger than the mafia in drugs," Mr Dangote told an investment conference in June.

"They don’t want the trade to stop. It’s a cartel. Dangote comes along and he’s going to disrupt them entirely. Their business is at risk,” says Mr Emmanuel, the oil expert.

The fact that there have been some public disagreements with the regulator has only fuelled that suspicion.

Mr Dangote’s refinery near Lagos is thirsty, with a capacity of 650,000 barrels of crude a day.

You would have thought being located in Nigeria would make supply easy but then up pops this headline: "Nigeria’s Dangote buys Brazilian crude".

It follows a row over supply and pricing. The regulatory authority has complained about Mr Dangote’s negotiating tactics.

Nigeria’s crude oil is low in sulphur and, as one of the most prized in the world, fetches a higher price than many of its competitors.

When discussions over price began, Farouk Ahmed, the chief executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), accused Mr Dangote of "wanting a Lamborghini for the price of a Toyota".

Mr Dangote has complained of not being allocated as much crude as earlier agreed but even when the price issue is resolved, he will still need to import some crude.

“NNPC doesn’t have enough crude for Dangote. Despite all this instruction to give ample supply of crude to the refinery, NNPC can’t supply Dangote with more than 300,000 barrels per day," says Mr Akinosho of the Africa Oil+Gas Report.

He says this is partly because the NNPC has pre-sold millions of barrels of oil for loans.

In August 2023 it secured a $3bn loan from the Afreximbank financial institution. In return it is due to supply 164 million barrels of crude.

In September the NNPC admitted it was significantly in debt. It was reported to be owing its suppliers around $6bn for fuel brought into the country.

Nigeria’s oil production has plummeted in recent years from around 2.1 million barrels per day in 2018 to around 1.3 million barrels per day in 2023.

The NNPC has been stressing oil theft as the number one reason why production has dropped.

It says in just one week - from 28 September to 4 October - there were 161 incidents of oil theft across the Niger Delta and 45 illegal refineries were "discovered".

But Ms Anku believes that "the theft problem is overrated by the NNPC and the oil sector".

"It’s a convenient excuse,” she adds.

She points to other contributing factors causing the drop in production, including international oil companies selling their on-shore oil fields - some of which may no longer be viable having pumped oil for 60 years.

The 66-year-old Dangote, who is listed by the Bloomberg Billionaires Index as the second wealthiest person in Africa, made his fortune in cement and sugar.

He has always denied the suggestion that his empire benefitted from links to politicians in power who helped ensure he had a monopoly.

Today there are those who are critical of Mr Dangote’s tactics and amid tension with the regulatory authorities, the same accusation has resurfaced when it comes to the supply of fuel in Nigeria.

"Mr Dangote asked me to stop issuing licences for importation and that everyone should buy from him. To which I said 'No' because it’s not good for the market. We have energy security interests," says Mr Ahmed of the regulatory authority.

Mr Dangote has not commented on the accusation but has said it makes business sense for the traders to buy from his refinery rather than from outside.

A feud between the regulator and Mr Dangote over supplies and pricing has rumbled on and morphed into another row with local fuel traders refusing to buy from the new refinery.

The mud slinging has also included allegations that some traders have been buying up substandard fuel from Russia which is then blended with other products before being shipped into Nigeria.

But not everyone is worried or surprised by the disagreements.

Ms Anku points to lessons learnt from US businessmen back in the 19th Century.

"The JP Morgans and the Stanfords – they didn’t have it easy either. That’s why they had to go and get government support and subsidies to build their railways and so on.

"I see the drama as a very normal process as you’re changing the structure of the economy. There are losers, they lash out. There’s no chance they’ll stop the refinery from working or selling its products to the Nigerian markets… in my view."

The modern, local refinery has also led to a debate over the quality of fuel on the market. It is an important issue given the vast number of generators belching out fumes across Nigeria as a result of the woeful power supply.

"Every day I wake up to the smell of what I’m sure [could] kill me. It’s because of the quality of the diesel," says Mr Akinosho.

He sees Mr Dangote’s refinery as a real opportunity for higher quality petroleum products in Nigeria which would be better for both car engines and people’s lungs.

But right now, Nigerians being hit hard in the pocket may find it difficult to be optimistic.

Arguments between officials at the Dangote refinery, the oil marketers and the regulators are batted back and forth in the media. All sides have been accused of hiding some facts and figures which leaves people guessing what is going on inside this still somewhat opaque industry.

"Everyone is a villain. There are no heroes here," concludes Mr Akinosho.

By Will Ross, BBC

Related stories: Dangote refinery finally reveals petrol prices

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Nigeria lifts oil production to 1.8 million barrels per day

Nigeria's state oil firm NNPC said on Thursday it had increased oil production to 1.8 million barrels per day (bpd), with the possibility of getting to two million bpd by year-end.

Oil production at Africa's top crude exporter was estimated at 1.3 million bpd in October, according to producer group OPEC's latest report. Nigeria often counts condensate production of around 250,000 bpd as part of its production.

The NNPC said the increase was a result of collaborative efforts with its joint venture operators and its partners on production-sharing contracts, alongside security agencies and the government.

"The team has done a great job in driving this project of not just production recovery but also escalating production to expected levels that are in the short and long terms acceptable to our shareholders," NNPC CEO Mele Kyari told a press briefing.

Nigeria has been battling crude theft in its Niger Delta production region, sabotage, and local unrest, which has hampered output growth.

In June, NNPC set up a 'war room' to coordinate efforts of oil partners, the government and private security personnel to stem crude theft. Since then, several vessels used in stealing crude have been destroyed and some illegal refiners arrested.

Kyari said the interventions across every segment of the production chain, supported by rigorous pipeline monitoring from security agencies, had been critical to the recovery.

By Camillus Eboh, Reuters

Nigeria's NNPC signs 10-year gas sale deal with Dangote Refinery

Nigeria's state oil firm, NNPC Ltd said on Wednesday one of its subsidiaries has agreed to supply 100 million standard cubic feet of gas per day to the Dangote oil refinery for the next 10 years.

Financial details were not disclosed.

Under the agreement, NNPC Gas Marketing Limited will supply the refinery built by Nigerian billionaire Aliko Dangote in Lagos with natural gas for power generation and feedstock. The contract has options for renewal and additional supply.

NNPC, Africa's biggest oil producer, is seeking to promote domestic gas consumption for industrial growth. 

By Isaac Anyaogu,Reuters

Nigeria Sees Crude Output Rising 30% by Year-End on New Deals

Nigeria expects a 30% increase in crude and condensate output as authorities strengthen security around the nation’s oil infrastructure and incentives in the sector attract investment, even though the gain could cross its OPEC+ commitment to limit production.

Output will reach 2 million barrels a day before the end of the year from 1.54 million barrels in September, according to the Nigerian Upstream Petroleum Regulatory Commission. “As at today the country’s crude oil production plus condensate is 1.8 million barrels per day and we’re pushing, working with everyone to increase it to two million barrels a day before December,” Enorense Amadasu, executive commissioner for the Abuja-based agency said at a conference in Lagos on Monday.

While the regulator didn’t disclose the proportion of crude to condensate in its projection, a higher level would push output closer to or over the 1.5 million barrel a day quota that Nigeria agreed with OPEC+ not to exceed. The 23-nation group has implemented the production limits to stave off a surplus and shore up crude prices.

Not all members have followed the plan. The group’s leadership has pressed members like Iraq, Kazakhstan and Russia to fully implement output cuts pledged at the start of the year, and make additional reductions in compensation for over-producing.

Africa’s largest oil producer has stayed below its OPEC+ quota for more than two years due to a lack of investment and widespread theft and vandalism in the oil-rich Niger Delta. President Bola Tinubu’s government has made efforts to draw investors to the sector by offering tax breaks to producers as well as approving pending asset sales.

The upstream regulator is looking to open bids for 31 oil and gas blocks spanning the country’s onshore and offshore acreage as part of measures to further increase production, Amadasu said, without giving a timeline. “These blocks have been carefully selected for its potentials to boost our reserves and stimulate economic activities,” he said.

By Emele Onu, Bloomberg 

Petrol landing cost falls in Nigeria as local pump price increases

In a statement, the Nigeria Labour Congress (NLC) expressed concerns that the pump price of petrol in Nigeria continues to exceed market values, raising questions about the fairness of pricing for consumers.

This marks a significant 20.23% decrease from ₦1,219 per litre recorded in August 2024, according to data from the Major Energies Marketers Association of Nigeria.

The decline is attributed to fluctuations in both the Naira-dollar exchange rate and the international price of crude oil.

As of the end of trading on Friday, the Naira stood at ₦1,678.87 to the dollar, with Brent crude priced at $73.63 per barrel.

This contrasts with the rates in August, when crude was priced at $80.72 per barrel, and the Naira exchange rate was ₦1,611 per dollar.

Despite the lower landing cost, petrol remains expensive at the pump in Nigeria. The retail price of petrol ranges from ₦1,060 to ₦1,200 per litre at various stations, including those operated by the Nigerian National Petroleum Company Limited.

The price of petrol had already surged from ₦617 per litre in August 2024 to over ₦1,060 per litre by November 2024.

The Dangote Refinery has recently announced ex-depot prices of ₦960 and ₦990 per litre for petrol delivered by ships and trucks, respectively.

In a statement, the Nigeria Labour Congress (NLC) expressed concerns that the pump price of petrol in Nigeria continues to exceed market values, raising questions about the fairness of pricing for consumers.

By Segun Adeyemi, Pulse Nigeria

Video - Nigerians urge government to lower gas prices

Cooking gas prices in Nigeria have more than doubled since 2023, forcing households to rely on cheaper, traditional fuels. Experts warn that this crisis has shifted beyond an economic concern and is now about survival. They are calling for urgent action to prevent a crisis.

CGTN

Dangote refinery finally reveals petrol prices

Dangote Refinery on Sunday said it sells its petrol at N960 per litre into ships and N990 per litre into trucks.

The company’s Group Chief Branding and Communications Officer, Anthony Chiejina, disclosed this in a statement on Sunday.

The company made this known in reaction to a claim by the marketers that the refinery’s prices are higher than other suppliers, making it difficult for independent marketers to buy from it.

The National Assistant Secretary of IPMAN, Yakubu Suleiman, disclosed this while speaking on the ARISE TV morning show on Friday. He said: “Like last week, Dangote’s price is higher than other places. Because if you can go by the price, the international price of crude has already started coming down. If I could remember, as of last week, he gave N995 per litre, and you have to bring your cargo and load.”

“How much will you pay for the cargo? And how much will go to the depot? And you expect independent marketers to go and sell it. Can we go and sell? Look, we have to pity Nigerians,” Mr Suleiman said.

In its statement on Sunday, the Dangote Refinery said its prices are benchmarked against international rates, ensuring competitiveness.

The company claimed that anyone importing petrol at lower prices likely brings in substandard products, posing health and environmental risks.

“We had lately refrained from engaging in media fights but we are constrained to respond to the recent misinformation being circulated by IPMAN, PETROAN, and other associations.

“Both organisations claim that they can import PMS at lower prices than what is being sold by the Dangote Refinery. We benchmark our prices against international prices and we believe our prices are competitive relative to the price of imports,” Mr Chiejina said.

He explained that if anyone claims they can land petrol at a price cheaper than the price Dangote is selling, then they are importing substandard products and conniving with international traders to dump low-quality products into the country, without concerns for the health of Nigerians or the longevity of their vehicles.

The Dangote spokesperson claimed the regulator, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), does not even have laboratory facilities which can be used to detect substandard products when imported into the country.

“Post deregulation, NNPC set the pace by selling PMS to domestic marketers at N971 per litre for sale into ships and at N990 for sale into trucks. This set the benchmark for our pricing and we have even gone lower to sell at N960 per litre for sale into ships while maintaining N990 per litre for sale into trucks.

“In good faith, and in the interest of the country, we commenced sales at these prices without clarity on the exchange rate that we will use to pay for the crude purchased,” he said.

At the same time, he said an international trading company has recently hired a depot facility next to the Dangote Refinery, with the objective of using it to blend substandard products that will be dumped into the market to compete with Dangote Refinery’s higher quality production.

This, he said, is detrimental to the growth of domestic refining in Nigeria.

“We should point out that it is not unusual for countries to protect their domestic industries in order to provide jobs and grow the economy. For example, the US and Europe have had to impose high tariffs on EVs and microchips in order to protect their domestic industries.

“While we continue with our determination to provide affordable, good quality, domestically refined petroleum products in Nigeria, we call on the public to disregard the deliberate disinformation being circulated by agents of people who prefer for us to continue to export jobs and import poverty,” he added.
 

Background

Last Tuesday, Aliko Dangote, founder and president/chief executive of the Dangote Group, said his refinery has more than 500 million litres of petrol in stock, but marketers have not been buying the product.

He questioned why the NNPC and private retailers were still importing petrol when his refinery could produce enough.

“So, I am expecting that the NNPC Ltd and the marketers should stop importing; they should come and collect what they need,” Mr Dangote said Tuesday.

Mr Dangote did not say for how long the 500 million litres of petrol had been refined and stored by his 650,000 barrels per day refinery.

However, PREMIUM TIMES reported that data from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) showed that his refinery was unable to meet the required volume of petrol sought by NNPC Ltd for three weeks.

According to the Dangote Evacuation Report seen by this newspaper, between 15 September and 5 October, the refinery delivered only 148 million litres of petrol, instead of 575 million litres.

Last Thursday, Dangote Refinery said it has not received any payments for the purchase of refined petroleum products from the IPMAN. The company made this known in reaction to a claim by the marketers that they were unable to load petrol from the refinery for days.

By Mary Izuaka, Premium Times