Nigeria to Allow Aliko Dangote’s Refinery to Set Gasoline Prices

Nigeria is considering allowing billionaire Aliko Dangote’s refinery to set the price of the gasoline it sells, people with knowledge of the matter said, a move that’s poised to refashion the government’s control over what customers pay for fuel.

Until now, Africa’s largest oil producer has imported all of its gasoline and subsidized the price at a hefty annual cost. But in a major change, Dangote’s massive plant near the commercial hub Lagos is starting to locally refine gasoline.


Nigeria will allow Dangote to set the price of gasoline to petroleum marketers starting next month, according to officials with knowledge of the matter. They asked not to be identified as they’re not authorized to speak to the media.

State-owned oil company NNPC Ltd. — the sole importer of gasoline — has since August 2023 been reselling the product below market cost to temper prices, after a brief removal of the subsidy pushed up inflation and fanned public protests. This week it lifted the price by 45%, to 897 naira ($0.56) per liter, moving it closer to market prices.

The government said Dangote will be free to set its own price.

“Dangote Refinery will certainly not sell their products below market value as a business that was set up to make profit,” said government spokesman Temitope Ajayi. “I don’t see how NNPC or the federal government will control price for a private business,” he said.

The role of the petroleum industry regulator “will be to ensure products quality and fair pricing so that the business doesn’t take undue advantage of the citizens or rip them off,” Ajayi said.

The changes occur amid severe gasoline shortages in major Nigerian cities after debts incurred by NNPC, in part due to the subsidy, disrupted its ability to supply gasoline. It said it is owed 7.8 trillion naira ($4.9 billion) by the government in subsidy debts for the seven months to July.

Going forward, petrol marketers will be allowed to buy products directly from the Dangote Refinery, the people said. A spokesperson from Dangote Industries didn’t immediately respond to requests for comment.

The facility at full rates is expected to be able to produce about 330,000 barrels a day of gasoline, according to Randy Hurburun, senior refinery analyst at consultancy Energy Aspects Ltd. That’s more than 1% of global demand for the road fuel, which is about 27 million barrels a day. It’s more than enough to meet the UK’s entire requirement.

By Ruth Olurounbi, Bloomberg

Related story: Dangote Refinery begins petrol production, vows to ease Nigeria’s fuel crisis

Gridlock in Nigeria amid fuel shortages and price hikes

Nigerians have been hit by a double whammy of chronic fuel shortages and a hike in prices by the state-owned oil company.

The Nigerian National Petroleum Corporation (NNPC), which imports the country’s fuel and distributes it to private sellers, blamed its debts and rising global prices for its difficulty in getting fuel.

Many people have been left stranded with long queues at petrol stations nationwide. Commuters in Lagos have been lining up at bus stations, but there very few buses operating.

Others told the BBC they have been forced to trek long distances as public transport prices have doubled along some routes.

On Tuesday, the NNPC said it was putting up the petrol price from 617 naira ($0.40, £0.30) to 897 naira a litre.

Its petrol stations have the cheapest fuel on sale in the country - but at the vast majority of other private garages the pump price is much higher.

When the NNPC puts up the price, so do private sellers and in some states, like Oyo, Kano and Kaduna, petrol is now selling for as much as 1,200 naira a litre.

Many garages around the country have shut because they have run out of fuel, others have closed to adjust their prices.

In the capital, Abuja, most are open but all have long queues as desperate drivers wait their turn - some slept in their cars overnight.

Fuel stations are not rationing supply, so there is a danger their wait will be futile.

A motorcycle rider in Kano, the main trading hub of northern Nigeria, said it was frustrating: “Most of the fuel stations here in Kano are closed because they want to adjust their pumps to the new price.

“I was able to get fuel at 950 naira at a particular station, but other places have already started selling at 1,200 per litre,” Aminu Danyaro told the BBC.

Black-market traders, who buy fuel from petrol stations and sell it by the roadside from jerrycans at inflated prices, are doing a brisk trade in Kano, where there is significantly less traffic than usual.

The Nigeria Labour Congress (NLC) - the country’s main trade union body - says it feels “betrayed”, explaining that the reason it accepted the new minimum monthly wage of 70,000 naira ($44, £34) in July was because there was an agreement with the government that petrol price would not be increased.

When President Bola Tinubu came to power last year, he shocked Nigerians on his first day by removing a subsidy that kept the price of fuel low.

This - amongst other policies - has led to the worst economic crisis in a generation and cost-of-living protests, dubbed “10 days of rage”, were held countrywide last month.

Nigerians are now pinning their hopes on the new privately owned Dangote Petroleum Refinery, which has been built by one of Africa’s richest man, Aliko Dangote.

On Monday, it was announced with great fanfare that the refinery had just started producing petrol - a milestone in Nigeria which despite being Africa’s largest producer of crude oil imports all its refined fuel.

But it is not clear how long Nigerians will have to wait to see ready availability of petrol or a drop in prices.

By Yūsuf Akínpẹ̀lú, BBC

Video - President Tinubu to advocate for increased investments in Nigeria at FOCAC summit

The Director of the Centre for China Studies in Abuja, Charles Onunaiju, says President Tinubu will focus on expanding and consolidating existing cooperation at the 2024 Summit of the Forum on China-Africa Cooperation (FOCAC). The expert emphasized that Nigeria urgently needs critical infrastructure, and the 2024 FOCAC summit presents a crucial platform to address that need.

CGTN

Suspected Boko Haram attack kills dozens in Nigeria

People gathered on Tuesday (September 3) in northeastern Nigeria, to bury the victims of a suspected Boko Haram attack in Yobe state.

Suspected Islamist militants belonging to the group roared into Mafa village on motorcycles on Sunday afternoon, opening fire on a market and setting shops and homes ablaze.

An early estimate from a military official said at least 37 people were killed in the attack.

But residents and officials said the death toll could be even higher, with villagers still missing and feared dead after fighters chased them into the bush.

A Yobe police spokesperson told Reuters the attack was an apparent retaliation for the killing of two suspected Boko Haram fighters by local vigilantes.

General Dahiru Abdulsallam is a special adviser on security matters in Yobe state.

‘’Coward Boko Haram that went and attacked innocent citizens in their villages and killed them, so we came to bury them and to also condole their families and relations as well as the local government.’’

Yobe is one of three states at the frontline of an insurgency that has lasted 15 years.

Thousands of Nigerians have been killed and more than two million people have been displaced.

Reuters

Why Nigeria’s ‘Mr Flag Man’ has waited a year to be buried

The family of the man who designed Nigeria’s national flag have told the BBC they have given up waiting for a promised state funeral, a year after he died.

Instead Taiwo Michael Akinkunmi, who died a year ago aged 87, is going to be buried this week in Oyo state, where he lived.

Akinkunmi, known by many as “Mr Flag Man” and whose house was painted in the distinctive green and white colours of the national flag, was a humble man.

But his son hopes that during his send-off, which Oyo state has agreed to fund, he will be remembered for the design that became a symbol of a united Nigeria.

“We have to give him the befitting burial he deserves,” his son Akinwumi Akinkunmi told the BBC Focus on Africa podcast.

Taiwo Akinkunmi always said he was an unlikely flag designer. He entered a competition for a new design ahead of Nigeria’s independence from the UK in October 1960.

At the time he was studying electrical engineering in London and had spotted a newspaper advert about the competition.

According to flag expert Whitney Smith, 3,000 designs were submitted - “many of great complexity”.

But Akinkunmi’s was a simple affair, with equal green-white-green vertical stripes - and it replaced the colonial flag that had included the British union jack and a six-pointed green star under a red disk.

Akinkunmi’s original design included at its centre a red sun surrounded by rays. This was intended as “as a symbol of divine protection and guidance”, Mr Smith wrote in the Encyclopaedia Britannica.

However the sun was omitted by the committee, which awarded the then 23-year-old £100 (then worth $280) for his winning design.

Akinkunmi always said his inspiration came from his childhood as he had travelled and lived in various parts of Nigeria.

Born in Ibadan in the south-west, now capital of Oyo state, he spent his early years in the north of the country because of his parents’ work. He grew up in what he said was a happy polygamous family and was one of his father’s 10 children.

He returned to Ibadan to finish his education. He once told ThisDay journalist Funke Olade that his secondary school was like a “mini-Nigeria” as it had students from all over the country.

Nigeria is home to more than 300 ethnic groups and while Africa’s most populous country has no official religion, the nation is roughly divided between the mainly Muslim north and the largely Christian south, though many communities are mixed.

For Akinkunmi the green in his flag symbolised the nation’s rich agricultural heritage, while the white represented peace and unity.

“It is typical that Nigeria, like many other culturally diverse countries, chose a simple flag design. A more complex design might have explicitly honoured some ethnic and religious groups while excluding others,” Mr Smith wrote.

Agriculture was always close to Akinkunmi’s heart and he was excited to return to Nigeria after independence to take up at a job with the Ministry of Agriculture, where he worked as a civil servant until he retired in 1994.

But for much of his life very few people knew about his contribution to the country, though wherever he lived he reportedly used to paint the outside of his house green and white.

It was not until Nigeria celebrated its 50th year of independence that he was recognised as one of 50 distinguished Nigerians.

His son says an Oyo state politician later lobbied for him to be given a national honour and pension - and in 2014 he was made an Officer of the Order of the Federal Republic (OFR), one of Nigeria’s highest awards.

After Akinkunmi’s death last year, a senator sponsored a successful motion that he be given a state burial.

However, no plans have ever been made and as they waited, Akinkunmi’s family have been paying 2,000 naira ($1.30; £1.00) a day to keep the body at a morgue.

The flag designer’s son said that in June they found out that the arts ministry’s National Institute for Cultural Orientation (Nico) had been directed to sort out the state funeral.

But apart from one phone call, he said the institution had failed to communicate any further.

He feels waiting any longer would just sully his father’s name.

This is when the Oyo state government decided to step in to fund the burial rites for the flag designer.

“My late father was an easy-going person who didn’t want anything to tarnish his image,” his son told the BBC.

“He was well brought up, he was a very intelligent man, and a good person that everyone wanted to associate with,” he added.

By Blessing Aderogba, BBC