Financial Energy Review
The Nigerian National Petroleum Corporarion (NNPC) has said it has not taken a final decision on the acquisition of 20 percent Stake in the Dangote Refinery.
Dr. Kennie Obateru, the Group General Manager, Public Affairs Division, told Financial Energy Review in a telephone conversation that the management of NNPC has not taken a decision on this proposal. “It is just a proposal that someone suggested, the management has not event sat to take a decision on it” Obateru said.
This is contrary to the report by S&P Global Platts last week that the NNPC was in advanced talks with Dangote Industries to acquire a 20 per cent stake in the 650,000 bpd Dangote oil refinery.
“Negotiations have reached an advanced stage. We are hoping to wrap up the negotiations before the refinery goes on stream” the report said
On why such suggestion should be made to invest in a private business like that of Dangote Refinery and at the same time engaging private investor in Operation and Management (O & M) in the Port Harcourt Refinery?
The O & M engagement is being interpreted and seen by some stakeholders as being a way the government wants to hands off the running of the nation’s four refineries in future as it is the trend now in other clime.
The NNPC spokesman said that engaging private investors in O & M in the nation’s Refinery does not mean government is handing off the running of the Refineries to private investors. Rather it is a statement that the government is ready to encourage private investors to share the risk of running a refinery .
According to Obateru if NNPC eventually takes a final decision on buying into the Dangote refinery it will be made public.
Furthermore, it is said that part of the move by NNPC to buy into the Dangote refinery is for government to ensure that the interest of ordinary Nigerians are protected.
However, a cross section of the industry stakeholders said that government move to buy into private refinery may be against the spirit of full deregulation as government may continue to influence decision in the running of the refinery.
“What you are seeing is a deceitful game to hand over Nigeria’s domestic 450,000 barrels per day crude oil meant for the 3 dead refineries to Dangote and to use public funds to do a private project.
“This is one of the main reasons why, against all rationality/common sense , they have obstinately refused to Privatise the three dead refineries, which they have used to misappropriate over N750billion over the last 5 years by way of TAM and losses” the stakeholders said
According to them Dangote Group, owners of the Dangote refinery, should be allowed to operate the refinery efficiently as a private entity.
This is because, they said government regulations and policies make decisions around private investments becomes political.
