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Local Refining: Petrol price to crash to N300/Litre – Modular Refineries

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Last Updated on June 10, 2024 by Fellow Press

The pump price of Premium Motor Spirit, popularly called petrol, should drop to about N300/litre upon the commencement of massive production by the Dangote Petroleum Refinery and other indigenous producers, operators of modular refineries stated on Sunday.

However, they pointed out that this would be achieved when the government ensures the provision of adequate crude oil to local refiners, stressing that refineries abroad were ripping off Nigeria.

Speaking under the aegis of the Crude Oil Refinery Owners Association of Nigeria, they explained that what happened to the cost of diesel after Dangote started producing it, would happen to petrol price once it is being produced massively in Nigeria.

CORAN is a registered association of modular and conventional refinery companies in Nigeria.

“A lot of companies today benefit from the importation of petroleum products at the expense of Nigerians,” the Publicity Secretary, CORAN, Eche Idoko, stated.

He told our correspondent that “if we begin to produce PMS today in large volumes, provided there is adequate crude oil supply, I can assure that we should be able to buy PMS at N300/litre as the pump price.

“Why make Nigerians buy it at almost N700/litre when you know that if you allow refineries work the price will come down? Is it because you want to satisfy the global refiners abroad that are making so much from us?”

When told that there are arguments that it is not possible to have such a drop in price because crude oil, the raw material for PMS, is price in dollars, the CORAN official insisted that petrol price would crash once it is being produced massively by indigenous refiners.

He said, “We were selling diesel for N1,700 to N1,800/litre, but as soon as Dangote refinery started production he brought down the price to N1,200/litre. What other proofs do you need?

As I speak to you now there is every tendency that before December diesel price will drop further. The only reason reason why diesel is not doing below N1,000/litre is because of our exchange rate.

“If the exchange rate drops, diesel will drop below the N1,000/litre price. Now the exchange rate concern is because Dangote imports crude. If he is not importing, the exchange rate may not have so much effect, though he is still buying crude in dollars (in Nigeria) anyway.”

On May 18, 2024, The PUNCH reported that Africa’s richest man, Aliko Dangote, stated that following the laid-down plans of the Dangote refinery, Nigeria would no longer need to import petrol starting June this year.

Dangote had also stated that his refinery could meet West Africa’s petrol and diesel needs, as well as the continent’s aviation fuel demand. He spoke at the Africa CEO Forum Annual Summit in Kigali, expressing optimism about transforming Africa’s energy landscape.

“Right now, Nigeria has no cause to import anything apart from gasoline (petrol) and by sometime in June, within the next four or five weeks, Nigeria shouldn’t import anything like gasoline; not one drop of a litre,” the billionaire had declared.

Also, Dangote had earlier in the year crashed the pump price of diesel to N1,200/litre when the commodity was selling at between N1,700 and N1,800/litre at the time.

He further dropped the price to below N1,000/litre, but could not sustain this price due to the rise in exchange rate. The refinery eventually returned the price to the initial rate of N1,200/litre.

Speaking on Sunday, the CORAN spokesperson stated that this was why the modular refiners had been calling for the sale of crude oil at the naira equivalent of the dollar rate.

“We have told them (government) that even the dollars that you are asking us to use and buy this product, it is detrimental to the country. Strengthen the naira. We will buy at the international market rate, but at a naira equivalent.

“These are the issues and they know these things but we can’t explain why they really can’t take decisions to change these concerns.

“Get crude to local refineries, allow crude purchase in naira equivalent, make the environment business-friendly and watch locally produced petroleum product prices crash,” Idoko stated.

Nigeria currently has 25 licensed modular refineries. Five of them are operating and producing diesel, kerosene, black oil and naphtha. About 10 are under various stages of completion, while the others have received licences to establish.

Operators of modular refineries earlier stated that aside from the five that are in operation currently, the remaining plants are embattled due to the major challenge of crude oil unavailability, a development that has stalled funding from financiers.

“Only about five of our members have completed their refineries. The others are having a major challenge.

“This challenge is that the people who are supposed to finance them have not disbursed financing for construction because they want some level of guarantee.

“A guarantee that if they finish the refinery, they are going to get feedstock, which, of course, is crude oil,” Idoko had explained.

Oil marketers also believe that the cost of petrol should be lower than its current price once its production begins in Nigeria.

They welcomed the comment of Dangote that his refinery should start pumping out petrol this month, and expressed hope that the cost would be less than the price which the Nigerian National Petroleum Company Limited currently sells.

“We expect a reduced price for locally produced PMS, as I’ve earlier told you,” the National President, Independent Petroleum Marketers Association of Nigeria, Abubakar Maigandi, stated.

Maigandi, while speaking from Saudi Arabia with our correspondent on Sunday, also stated no date has been communicated to marketers on when Dangote would release petrol to the market. Officials of Dangote refinery have remained mute on this.

“It is a welcome development if the refinery can start releasing PMS this month because as marketers we are currently set to start buying the product from the plant,” Maigandi stated.

The IPMAN president earlier stated that marketers were discussing with the managers of the plant, but not specifically on petrol pricing.

“We have been discussing, but not about the price of petrol yet, rather on other matters such as the registration of members for the purchase of petrol and diesel from the refinery.

“It is true that we have started buying diesel from them, but you have to register with the company first. So a general registration is ongoing,” he explained.

Maigandi, however, stated that though marketers had yet to receive the projected price for petrol from the plant, dealers would want to see a PMS price of about N500/litre from the Dangote refinery.

“We are looking at having it (PMS) at any price below the NNPC rate. The price which NNPC sells petrol is N565.50/litre, so we are expecting something below that price, maybe around N500/litre,” Maigandi stated.

The oil dealers also joined in the call for the provision of crude oil to local refiners, stressing that this would impact positively on the prices of refined petroleum products.

“Of course, it is important for crude to be made available to local refineries because this will surely affect petroleum products’ prices positively,” the IPMAN president stated.

Regulators speak

The spokesperson of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, George Ene-Ita, said he was sure that the government has guidelines for the provision of feedstock (crude) to indigenous refiners.

Ene-Ita promised to provide additional information on the matter, as he stated that he could not give further details at the time he was contacted by our correspondent.

Recall that the Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission, Gbenga Komolafe, had earlier promised that the government would ensure that crude oil was supplied to domestic refiners.

He stated that in compliance with the provisions of Section 109(2) of the Petroleum Industry Act 2021, the NUPRC in a landmark move, had developed a template guiding the activities for Domestic Crude Oil Supply Obligation.

“The commission in conjunction with relevant stakeholders from NNPC Upstream Investment Management Services, representatives of Crude Oil/Condensate Producers, Crude Oil Refinery-Owners Association of Nigeria, and Dangote Petroleum Refinery came up with the template for the buy-in of all.

“This is in a bid to foster a seamless implementation of the DCSO and ensure consistent supply of crude oil to domestic refineries,” Komolafe had stated.

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Breaking: Rotten tomatoes, pepper dangerous — Doctor warns Nigerians

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Last Updated on June 15, 2024 by Fellow Press

A medical doctor, identified simply as Wales, has warned Nigerians to stay away from rotten tomatoes and pepper, known as ‘eesa’ or ‘baaje’ tomatoes.

In a clip that went viral on social media, Wales stated that the continuous consumption of rotten tomatoes and/or pepper posed several health risks, and could lead to cancers, due to the presence of harmful microorganisms such as fungi, known to produce mycotoxins.

Displaying rotten tomatoes on a plate, the doctor stressed that the tough economic situation should not be a reason for people to eat ‘poison’.

He said, “Fellow Nigerians, good morning. I know that, because of the economy, you are saving money on so many things. But please, if you see this thing, (rotten tomatoes and peppers) in the market, run away.

“Just because we are in a ‘rogbodiyan’ (tough) economy does not mean you should start eating poison, because this type of tomato can cause cancer.

“Fresh tomatoes are vegetables rich in Vitamin C, potassium and antioxidants. Rotten tomatoes, however, aren’t fresh in any way but are soft pieces of piled tomatoes sold at cheaper prices to people who cannot afford the fresher options.

“And, because they are broken, this type of tomatoes are easily accessible to flies, which deposit germs and eggs inside them. But, that’s not the worst part. As these tomatoes break, microorganisms invade them, causing them to rot. Among these microorganisms are fungi known to produce something known as mycotoxins. Meanwhile, mycotoxins have been linked to cancers and induction of immune deficiency in humans. And, because tomatoes contain lots of fluid, these mycotoxins spread faster to all parts of the tomatoes.”

The medical doctor also stated that boiling and washing the tomatoes would not rid them of the mycotoxins, which not only cause cancer but can also damage the kidney and liver.

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Minimum Wage: ₦‎250,000 demand not sacrosanct – TUC

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Last Updated on June 15, 2024 by Fellow Press

Trade Union Congress (TUC) President Festus Osifo said yesterday that there was nothing sacrosanct about the N250,000, adding that labour was receptive to adjustments.

There was no immediate response from the federal government last night on the latest stance of organised labour, although the Senate yesterday pledged to grant accelerated consideration and passage of the new minimum wage bill from President Bola Tinubu.

Only last Wednesday, the acting President, Nigeria Labour Congress (NLC), Prince Adewale Adeyanju, said labour’s demand “remains N250,000, and we have not been given any compelling reasons to change this position, which we consider a great concession by Nigerian workers during the tripartite negotiation process.”

Adeyanju was responding to the Democracy Day broadcast of President Bola Tinubu in which he said an agreement had been reached on the new national minimum wage.

Osifo himself in his first reaction to the FG and OPS agreement on N62,000 as minimum wage penultimate Friday had said “for us (labour), we felt that with the current economic hardship and the difficulty in the land, the sum of N250,000 should be what will be okay as the minimum wage.

But speaking yesterday on Channels Television’s breakfast programme, The Morning Brief, he said there was “no figure that is sacrosanct; there is no figure that is cast in stone that both parties will be fixated on it.”

He added: “What we said is that for us, when we give figures, there is always a room to meander; there is always a room for us to do some adjustment here and there.

“One of the reasons that we went on industrial action the last time was because when it got to N60,000, they told us that a kobo could not even join the N60,000; that they could not even add one naira to it.

“So that was one of the reasons that led to that industrial action beyond the fact that there were also delays.”

President Tinubu is expected to send an executive bill to the National Assembly on the new minimum wage for legislative action.

The TUC President said that they are not going to pre-empt the President, but they are making all efforts to justify why Tinubu should tilt towards the figure presented by the labour instead of the one by the organised private sector and the government.

He said that if the President sends a figure that is not favourable to the labour to the National Assembly, they will still approach the lawmakers and push them to do much more.

Osifo vowed that the work of the labour leaders will not end until the Minimum Wage Act 2024 becomes law. He said it is premature to predict what labour will do if what is passed is not acceptable to them at the end of the day.

The FG and the Organised Private Sector (OPS) had on Friday, May 31 reached an agreement to pay N62,000 to their least paid worker; an increase of N2,000 on the N60,000 rejected two weeks ago by labour.

The 36 states, which were represented on the Tripartite Committee on the minimum wage, said on the same day that they could not afford to pay even N60,000 while the NLC and the TUC disagreed with government and the OPS.

They said the minimum they would accept was N250,000, which is N244,000 less than the N494,000 they initially demanded.

The Tripartite Committee has already submitted its report and recommendation to the President, who is expected to take a decision on the final figure to be sent by way of an Executive Bill to the National Assembly for consideration.

The TUC President said while labour was not disposed to pre-empting the President on his decision, the unions were keen on ensuring that Tinubu tilts toward the figure presented by labour instead of the N62,000 by government and OPS.

He said should the President decide on a figure labour finds unfavourable, it will take its struggle to the lawmakers to convince them for an increase.

He said it was premature to predict labour’s reaction if the action of the executive and the legislature turns out to be unfavourable.

Tinubu, at a state dinner to mark Democracy Day on Wednesday had declared that his planned minimum wage is “what Nigerians can afford, what you can afford and what I can afford.”

He added: “Cut your coat according to your size, if you have size at all.”

Apart from the state governments which have expressed their inability to pay even the N60,000 which labour had rejected prior to the June 3 and 4 strike, signals from the local governments also suggest that they cannot pay N62,000.

National President of the Association of Local Government of Nigeria (ALGON), Aminu Muazu-Maifata, said on Thursday that the LGs could not pay that amount.

Muazu-Maifata said some local governments have not even been paying their workers the ₦30,000 approved as minimum wage in 2019.

He said an affordable minimum wage should be set and not something unsustainable.

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