Television Nigerian

Those who wonder why the Dangote refinery has to buy imported petroleum have no clue how much Nigeria’s security system has failed to contain oil bunkering in the upstream sector of the petroleum industry.

Nigeria’s production quota, as approved by the Organisation of Petroleum Exporting Countries, is 1,500,000 barrels per day, out of which it reportedly achieves only 1,250,000 bpd, which some even say is overstated.

Some have suggested that if Nigeria pushes its production quota to anywhere near 2,000,000 bpd, OPEC will look the other way because of Nigeria’s current economic and (especially) foreign exchange challenges.

Imagine the delusion of those who fixed 1,780,000 bpd as the benchmark for Nigeria’s 2024 budget. This expected shortfall will result in inadequate cashback for the ambitious N27.5 trillion budget with its N9.18 trillion deficit.

And, of course, India and The Netherlands, major buyers of Nigeria’s petroleum, won’t ever get the quantity they need; they will get only a portion, and will have to source the shortfall from other suppliers.

The inability of the upstream sub-sector to achieve the OPEC quota caused the Federal Government to hire the security company of a former Niger Delta militant with a mouth-watering deal– which it announced with front-page display adverts to thank President Bola Tinubu for appointing a Niger Delta lady as Head of the Civil Service of the Federation.

With “too much money,” you may be looking for the most pedestrian way to announce that you don’t know what to do with the money. Peter’s Principle suggests that sometimes people are promoted beyond their level of competence!

It’s going to be awful difficult for NNPC Limited to supply enough petroleum to the Dangote refinery, or even its own refineries whose staff members are practically being paid as ghost workers, as they hardly produce a litre of petroleum products.

Here’s the math: Dangote refinery’s installed refining capacity is 650,000 bpd, while the four NNPC Limited refineries can refine 445,000 bpd. That gives you a total production capacity of nearly 1.1 million bpd, without considering the modular refineries.

But the priority supply is to oil bunkerers, the quota of the International Oil Company joint venture partners, Nigeria’s commitment to creditors, like AFREXIM Bank, and what NNPC Limited must sell to earn foreign exchange, which suggests that the 1.1 million bpd needed by NNPC Ltd and Dangote refinery may have to be imported.

You get no prize for correctly guessing the best kept secret of Nigeria’s petroleum sector, that NNPC Ltd and Dangote will not be able to refine enough petroleum unless they import the petroleum. Think of the child of a garment merchant with no clothes to wear.

If NNPC Ltd is able to reverse this trend (that is almost cast in stone) and (at least) supplies the 445,000 barrels due to NNPC Ltd to the Dangote refinery, for naira, as directed by Tinubu, petroleum products should get to Nigerians regularly and without the additional burden of landing and foreign exchange costs.

But it may not quite work out that way. The Chief Executive Officer of Nigerian Upstream Petroleum Regulatory Commission, Gbenga Komolafe, who is either unwilling or unable to check the IOC’s thieving games, coyly gave the wet blanket argument that crude oil, being an international citizen, will be sold in dollars.

What this means, in simple English, is that the proximity of Dangote refinery to Nigeria’s oil fields gives it no advantage in the cost it gets petroleum, especially when the booby-trap of “willing buyer, willing seller.”

When a Yoruba man is alarmed and laments, “Se e ri aye nyin l’ode,” what they are doing, in a sarcastic manner, it is to draw your attention to how pathetic your situation has degenerated. The street would say that you are in deep manure!

Farouk Ahmed, CEO of the Nigerian Midstream and Downstream Regulatory Commission, may have allowed himself to be used to demarket the quality of diesel produced at the Dangote refinery to save the face of the NUPRC that cannot up production on the oil fields.

With the help of the team from the House of Representatives that tested his diesel with the quality they bought off the street, Aliko Dangote was able to prove that his diesel was 80 per cent better than diesel imported by NNPC Ltd.

It is appropriate that the House of Representatives is asking the Federal Government to immediately suspend Ahmed for what appears to be a hoax on the quality of diesel refined by the Dangote refinery.

He may have been saved by the emergency meeting brokered by Heineken Lokpobiri, Minister of State for Petroleum Resources, between him, Aliko Dangote, NNPCL GMD, Mele Kyari; and Komolafe of the NUPRC.

This meeting would have been unnecessary if Nigeria was not suffering from a revenue deficit and pressure on the naira, caused by the alarming failure of the NNPCL to guarantee increased petroleum exploration in its oil fields, in addition to producing enough petroleum products in its refineries.

But people like Ahmed, Komolafe, Kyari and Lokpobiri, should be hiding their faces in shame for being well paid, only to deliver failure to Nigerians who put them in such high positions of responsibility.

Maybe Ahmed will be happy when the Dangote refinery is snapped by President Brice Oligui Nguema, whose country, Gabon, is the seventh largest petroleum producer in Africa. Because he is heckled as a monopolist within the Nigerian economy, Dangote is so frustrated that he is offering his refinery for sale to the NNPC.

This is not to say that he may not be having monopoly issues in his trade in other commodities. But that is for Tunji Bello, just appointed CEO of the Federal Competitive and Consumer Protection Commission, to determine.

Some Dangote critics speculate that he is a beneficiary of crony capitalism. If BUA Group, Dangote’s main competitor in the commodities market, goes beyond complaining and advances its grievances against Dangote to a formal report, maybe more could be revealed.

Perhaps Dangote should mention the names of those NNPC operatives, who find it more convenient to invest in a petroleum blending plant in Malta, instead of ensuring that refineries within Nigeria get enough crude petroleum to produce petroleum products.

That is the only reason the likes of Kyari will not have to be desperately explaining that they have no other personal businesses, except for an agricultural enterprise, located maybe somewhere in his village.

It is unreasonable to think that Tinubu will be fighting himself by engaging in a revenge war against Aliko Dangote, whom he recently appointed as a member of his Presidential Economic Coordination Council.

Tinubu, as the Minister of Petroleum and Gas Resources, must heed the timely warning of illustrious Dr Akinwunmi Adesina, President of Africa Development Bank, who observes, “This whole issue on Dangote is shocking and creating (negative?) waves for Nigeria globally.”

Failure to urgently do so may discourage the foreign direct investors that the President has spent so much financial resources and countless foreign trips wooing to Nigeria. The counsel by billionaire Femi Otedola for the President to create “an enabling environment to ensure (that) businesses thrive” is apt.

If Kyari and his “unworking and unbusy” NNPC Ltd can ramp up production to supply enough petroleum to local refineries, to guarantee a regular supply of petroleum to Nigerians at a good price, Nigerians would surely rejoice.

But if he and his team cannot achieve that modicum, the President should ask them all to go.