Dangote Group Chairman, Aliko Dangote, has been granted a license by the Nigerian National Petroleum Company Limited (NNPCL) to import petroleum products. This development comes a few weeks after the inauguration of the Dangote Refinery. The license allows Dangote to import refined Premium Motor Spirit (PMS) into Nigeria, with the fuel being discharged at the Dangote barge and pumped into tanks.

The decision to grant the import license to Dangote stems from the fact that the Dangote Refinery is not yet fully operational to refine petroleum products. This move is likely to transfer the sole importation of PMS from the NNPCL to Dangote. The imported PMS will be sold to marketers at a price determined by the market, while work on the refinery continues.

Although the Dangote Refinery, with a production capacity of 650,000 barrels per day, was inaugurated last month, it is not yet ready to operate at full capacity. The refinery is currently at 88% completion, with some equipment yet to be delivered and others awaiting integrity tests. Additionally, works on production lines, including electrical works, are behind schedule. Based on these factors, it is unlikely that the refinery will be fully operational until March 2024.

The Dangote refinery, which costs $19 billion, boasts the largest storage capacity in Africa at 4.742 billion liters and a 1,100-kilometer pipeline infrastructure capable of handling three billion standard cubic feet of gas per day.

The Nigerian people had high hopes that the refinery would help mitigate the high cost of PMS following the removal of fuel subsidy. However, with news that the refinery's products will not be available until next year, alternative measures are being considered. The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has been urged to issue import licenses to companies and individuals with the capacity to import petroleum products, aiming to introduce competition in Nigeria's oil market and break the NNPCL's importation monopoly.

Dangote was chosen to import the product due to the NNPCL's 20% minority stake in the refinery. The NNPC has invested $2.76 billion in the plant, with payments made in cash, crude oil sales, and profits generated by the company. Approximately one-third of the payment will be in the form of crude oil supply, while the remaining amount will come from the company's profits.