Nigeria’s oil sector is currently facing a growing crisis in its domestic crude oil supply, which has been further exacerbated by a recent fire incident at a section of the Dangote Petroleum Refinery. This has caused significant concerns among operators at the Lagos Chamber of Commerce and Industry, who fear that it could discourage International Oil Companies (IOCs) and investors from investing in refinery projects. However, the management of the refinery has swiftly reassured that the situation was promptly brought under control, with no reported injuries.
Amidst the turmoil, the LCCI has called on the Nigerian government to intervene decisively. The Director-General of LCCI, Chinyere Almona, has emphasized the importance of transparency in resolving issues related to oil supply contracts, local crude costs exceeding international benchmarks, and logistical expenses.
The crisis has also exposed divisions within the sector, with modular refinery operators urging governmental bodies to urgently address the situation. These smaller refineries, which are part of Nigeria’s midstream oil and gas sector, argue that decisive action is necessary to stabilize crude supply and support local refining efforts.
In response to accusations by Devakumar Edwin, Vice President of Oil and Gas at Dangote Industries Limited, that IOCs are obstructing local crude purchases, the government has denied claims of allowing substandard fuel imports into the country. Meetings between government officials and stakeholders have been held to discuss market issues and regulatory compliance.
As the situation continues to unfold, industry observers stress the importance of constructive dialogue and regulatory oversight to protect investor interests and promote sustainable growth in Nigeria’s oil and gas sector.
The incident at the Dangote refinery highlights the ongoing challenges faced by Nigeria in its pursuit of self-sufficiency in refined petroleum products.
