… says NNPC is misinforming the Public
Dangote Refinery has debunked the claim by the Nigerian National Petroleum Corporation Limited (NNPC) that it provided a loan facility to the refinery to the tune of $ 1 billion when the company was struggling.
Dangote Refinery in a press statement signed by Tony Chiejina, Group Chief Branding and Communications Officer for Dangote Group, he accused the NNPCL of misinforming the public on the matter.
He said : “We have received numerous inquiries from the media and other concerned stakeholders seeking clarification on a recent report attributed to the Nigerian National Petroleum Company Limited (NNPCL) that their decision to secure a $1 billion loan backed by its crude was instrumental in supporting the Dangote refinery during liquidity challenges.
We would like to clarify that this is a misrepresentation of the situation as $1bn is just about 5% of the investment that went into building the Dangote Refinery.”
“Our decision to enter into a partnership with NNPCL was based on recognition of their strategic position in the industry as the largest offtaker of Nigerian crude and at the time, the sole supplier of gasoline into Nigeria.”
“We agreed on the sale of a 20% stake at a value of $2.76 billion. Of this, we agreed that they will only pay $1 billion while the balance will be recovered over 5 years through deductions on crude oil that they supply to us and from dividends due to them. If we were struggling with liquidity challenges we wouldn’t have given them such generous payment terms. As at 2021 when the agreement was signed, the refinery was at the pre-commission stage. In addition, if we were struggling with liquidity issue, this agreement would have been cash based rather than credit driven.”
“Unfortunately, NNPCL was later unable to supply the agreed 300 thousand barrels a day of crude given that they had committed a greater part of their crude cargoes to financiers with the expectation of higher production which they were unable to achieve.
We subsequently gave them 12 months for them to pay cash for the balance of their equity given their inability to supply the agreed crude oil volume. NNPCL failed to meet this deadline which expired on June 30th 2024. As a result, their equity share was revised down to 7.24%. These events have been widely reported by both parties.”
“It is, therefore, inaccurate to claim that NNPCL facilitated a $1 billion investment amid liquidity challenges. Like all business partners, NNPCL invested, $1 billion in the Refinery to acquire an ownership stake of 7.24% stake that is beneficial to its interests.
NNPCL remains our valued partner in progress, and all stakeholders must adhere to the facts and present the narrative in the correct context, to guide the media in reporting accurately for the benefit of our stakeholders and the public.”
The Nigerian National Petroleum Company Limited had said it secured a $1bn loan backed by crude oil to support the coming on stream of the 650,000 barrels per day capacity Dangote Petroleum Refinery.
It also stated that the firm facilitated the $3bn Gazelle loan as a critical intervention to help stabilise the federation’s foreign exchange crisis.
The Chief Corporate Communications Officer, Mr Olufemi Soneye, said these at the Energy Relations Stakeholders Engagement in Abuja on Monday.
Recall that in January 2024, the national oil firm arranged a syndicated $3.3bn crude oil prepayment facility in partnership with Afreximbank.
The bank said the deal was the largest crude-backed facility in Nigeria and one of the largest syndicated debts raised in Africa.
Speaking during the event, the spokesperson said these initiatives are a testimony to NNPCL’s dedication to driving national development partnerships.
He said with the leadership of Mele Kyari, NNPC Ltd has achieved groundbreaking milestones, redefining the trajectory of Nigeria’s oil and gas sector.
“Under the visionary leadership of Mele Kyari, NNPC Ltd has achieved groundbreaking milestones, redefining the trajectory of Nigeria’s oil and gas sector. Additionally, Kyari facilitated the $3bn Gazelle loan, a critical intervention that helped stabilise the federation during a challenging foreign exchange crisis,” Soneye stated.
On the support for Dangote, he said, “A strategic decision to secure a $1bn loan backed by NNPC’s crude was instrumental in supporting the Dangote refinery during liquidity challenges, paving the way for the establishment of Nigeria’s first private refinery.
“This initiative underscores NNPC’s dedication to fostering public-private partnerships that drive national development.”
Soneye also mentioned the restart of the Port Harcourt Refining Company, describing it as a significant turning point in Nigeria’s quest for energy self-sufficiency, reaffirming the company’s commitment to revitalizing the nation’s refining capacity.
He stressed that the national oil firm had championed the adoption of Compressed Natural Gas as an alternative energy source, offering Nigerians a cleaner and more cost-effective solution amidst rising global energy costs.
He recalled that in a historic achievement, NNPC declared profit for the first time in decades, marking a significant financial turnaround.
Soneye added that the company had already exceeded its profit projections for 2024, a testament to the transformative reforms of the firm.
He pledged that as a responsible energy company, NNPCL would continue to strengthen Nigeria’s energy sector while solidifying its legacy as a transformative force and a global game-changer.
At the stakeholders’ meeting, he said NNPCL recognizes the roles the stakeholders play in shaping the future of energy in Nigeria and beyond.
He stressed, “Together, we stand at the forefront of a transformative era in the global energy landscape, where collaboration, innovation, and sustainability are key to success.”
Energy relations, he said, are the backbone of NNPC Ltd’s operations and strategic aspirations as an integrated energy company.
Soneye said NNPCL remains committed to fostering meaningful relationships, driving excellence, and delivering value across the energy value chain.
He added that the meeting underscored the shared vision to ensure energy security, economic growth, and environmental stewardship for the benefit of all.
