We Can Sell Imported Petrol Cheaper Than Dangote Refinery, PETROAN Insists
Emmanuel Addeh in Abuja
The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) yesterday maintained that its members can sell petrol cheaper than the price that the Dangote refinery is currently offering oil marketers in Nigeria.
Dangote had on Sunday, among other associations, accused PETROAN of planning to make Nigeria a dumping ground for substandard products, stressing that any organisation that imports fuels lower than it is currently selling was selling low quality products.
But in a statement by the National Public Relations Officer of the organisation, Dr. Joseph Obele, the petrol retailers said that they have already successfully incorporated a strategic business unit for that purpose.
Citing patriotism following the pricing instability and turbulences in the downstream sector, it said the agenda of President Bola Tinubu for the oil sector remains inimical to advocates and beneficiaries of a monopolistic market.
The oil retailers stressed that Tinubu’s interventions were meant to liberalise the downstream sector by building an all inclusive market.
“Intensive or aggressive competition in any market brings the best value for money exchange for a commodity. Consumers get the best value for pricing when competition is at its peak, hence competition should be encouraged.
“Contrary to competition, such a market will be exploitative and strictly for profiteering. The publication by Dangote refinery that PETROAN will import substandard petroleum products is not coming as a surprise to stakeholders, because such is his usual gimmick for maintaining monopoly,” it added.
PETROAN argued that it has never compared the price of Dangote petrol with any other, based on the fact that Dangote’s price wasn’t known until its press release on Sunday.
“PETROAN has concluded plans with her foreign refinery counterparts and financial partners to import the best quality of Premium Motor Spirit (PMS) and then sell far lesser than the present selling rate of PMS in Nigeria.
“We planned to enter the market before December 2024, pending the approval of our import permit licence by the regulatory agency and access to foreign exchange from the Central Bank of Nigeria (CBN) at the official rate.
“Before now, Dangote Refinery had refused to make public her selling rate of PMS until IPMAN and PETROAN announced readiness to sell lesser. The rate of N990 as announced by Dangote refinery was inconsiderate based on the fact Dangote Refinery enjoyed massive concession for accessing foreign exchange during the construction of the refinery.
“The core determinant for setting price is consideration for cost of production, then addition of a fair margin. But this wasn’t the case for the determination of PMS price by Dangote refinery as they said the parameter was in comparison with the international selling rate at the global market.
“A nation that gave you a yet to be disclosed concession for foreign exchange which was highly criticised by financial expert’s, such a country pricing template shouldn’t have its template by the selling rate at the international market but rather it should have been cost of production plus fair margin.
“Goods from the China markets are not selling as high like goods from the America market because cost of production differs.
“The allegation that PETROAN will import inferior products and saying also that an international company is trying to establish a PMS blending plant in Lagos are all strategies for Dangote Refinery to push others out of the market in view achieving monopoly for exploitation,” the association said.
It stated that all the company’s allegations were with the objective of closing the doors for other operators so as to enjoy monopoly.
“Evidence available shows that diesel as a deregulated product was selling less than N800 in the Nigerian market a few weeks before the commencement of diesel production by the Dangote Refinery.
“At the entrance of the market by Dangote refinery, we witnessed a rapid surge above N1,000. PETROAN uses this medium to commend Mr President for his commitment towards the revamping of the nation owned refineries.
“We will still maintain our position by counselling that the Port Harcourt and Warri Refinery plant after rehabilitation should immediately be privatised and handed over to a reputable firm that has the technical capability, managerial skills and financial strength in partnership with PETROAN and other critical stakeholders.
“This will enable the operators of the government-owned refineries to withstand aggressive competition that will be posed by the known beneficiaries of monopolistic market,” it added.
