Fuel

Nigeria probes alleged import of contaminated fuel

On Monday, Nigerian lawmakers launched an inquiry into allegations of polluted fuel imports, aiming to address conflicts involving Aliko Dangote’s oil refinery and regulatory authorities. Chairman Ikenga Ugochinyere disclosed that the legislative committee is investigating claims of unregulated licensing and the absence of international standard laboratories linked to the contaminated products in Abuja. Aliko Dangote, President/CEO of Dangote Industries Limited, defended his position, expressing regret over the challenges faced but stressing the necessity to persevere through ongoing projects. The committee urged the parties in Nigeria’s petroleum sector to reduce tensions that have been heightened in recent weeks by allegations from the regulator that Dangote was trying to monopolize the market and that his refinery’s products are of poor quality. Dangote claimed that the mafia in the oil industry is more dangerous than the mafia involved in drugs.  He emphasized that while you may have some knowledge of your opponents in the drug trade, the oil mafia operates in secrecy both internally and externally.  He expressed his certainty that they may even have insiders aiding them in their operations.  Dangote also lamented the fact that Nigeria has been struggling with fuel queues since 1972, calling it a national shame. The largest refinery in Africa, located in Lagos, has a capacity of 650,000 barrels per day.  Despite being hailed as a game-changer by officials, the $19 billion facility has faced a slow start since opening over a year ago.  Due to challenges in sourcing crude oil locally, the refinery has had to rely on imports from other countries, highlighting Nigeria’s struggles with oil theft and corruption. The refinery’s senior executive has also alleged that international oil companies in Nigeria are scheming to cause the refinery to fail.  Devakumar Edwin, a vice-president of Dangote Industries, claimed that the companies are either intentionally demanding an exorbitant premium or stating that crude is not available. Farouk Ahmed, the chief executive of the regulatory agency, expressed concerns about Dangote’s request to suspend or stop the importation of petroleum products, citing potential market monopoly.  However, Dangote refuted these claims and welcomed lawmakers to inspect the plant where its products were tested.  He also clarified that he did not receive any incentives from the Nigerian government for the refinery and announced the cancellation of plans to invest in the steel industry.  The origin of the dispute between Nigerian authorities and Dangote, whose companies dominate various markets, remains unclear.  This conflict emerged after President Bola Tinubu succeeded Muhammadu Buhari, a close ally of Dangote, following last year’s presidential election.  Analysts warn that such disputes could deter foreign investments and destabilize Nigeria’s economy.  Nigerian economist Bismarck Rewane criticized allegations of low-quality products from the refinery, deeming them baseless without evidence or consumer complaints, suggesting deeper underlying issues.

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