Refinery: Anxiety mounts in NNPC as Dangote struggles to obtain approval

A fresh dispute has surfaced about the Dangote Refinery, a big project in Nigeria.

This time, rivalry between the Nigerian National Petroleum Corporation (NNPC) and Aliko Dangote, owner of the Dangote Group and the richest man in Africa, has raised questions about the refinery’s safety, quality, and morals.

Alhaji Aliko Dangote has reportedly applied for a license to operate, which is the final regulatory step before a refinery can begin any type of production.

However, the regulatory body, NNPC, has been hesitant to grant this license because of safety concerns because the refinery is still under construction. He also sought the NNPC to buy crude, but the NNPC declined, stating that it is illegal to sell petroleum to an incomplete refinery. It is now claimed that Dangote is attempting to import crude oil from Nigeria through trading firms, which might be viewed as “going through the backdoor.”

But even if he receives the harsh treatment, Dangote staff, contractors, and several NNPC officials have raised concerns about safety and quality. There are worries that the quality of the diesel and jet fuel produced would be poor without the refinery’s completion. Due to the potential danger to life posed by subpar diesel and jet fuel, NNPC is concerned.

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The refinery’s current configuration limits its ability to perform more than the first stage of crude distillation, which is comparable to what clandestine refineries operating in the Niger Delta region have been discovered to do. But because of the Dangote Refinery’s complexity and the fact that its catalytic cracking plant is still under construction, there are concerns about the refined goods’ quality.

According to reports, several Dangote Group employees have expressed concern over the decision to launch the refinery before it is finished. Despite these legitimate worries, Dangote’s response indicates a great need for the project to succeed, maybe as a “matter of survival.”

A heavy bite of financial pressure?

According to reports, Dangote is deeply in debt, putting the company in danger of going into receivership if they can’t raise extra money to pay back some of their loans before the end of the year. The fact that Dangote is anxious to obtain a license to begin operations despite the refinery’s incomplete state may be a result of this financial pressure.

Recalls that earlier this year, the unfinished refinery was hurriedly commissioned by the previous president Buhari to allow Dangote to access additional equity funding from the Nigerian Government as well as a crude allocation of 300,000 barrels per day, which insiders say would have been sold to raise money for creditors and partially fund the completion of the refinery. This oil allocation, however, was suspended when President Tinubu’s new administration took office. It was then discovered that the refinery had been erroneously falsely commissioned in order to seize the crude allocation and sell it abroad.

The conflict between Dangote and the NNPC serves as a stark reminder of the Dangote refinery project’s ongoing problems with quality, safety, and financial stability.

The settlement of this standoff would have significant effects on Nigeria’s oil industry due to worries that low-quality goods could endanger the lives of refinery workers and Nigerians in general, as well as the prospect of significant financial losses for a key business figure.

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