Data from the National Bureau of Statistics (NBS) has revealed that Nigeria disbursed N2.7 trillion in the third quarter of 2023 for importing premium motor spirit (PMS), diesel, and jet fuel, accentuating the country’s reliance on imported petroleum products due to unresolved refinery challenges.
Despite being a leading crude oil producer, Nigeria grapples with the necessity of importing substantial white products due to its inability to revamp domestic refineries.
During the specified period, PMS imports accounted for N1.9 trillion, diesel amounted to N736.7 billion, and jet fuel reached N135.8 billion.
Nigeria, among major oil-producing nations, uniquely depends on imported petroleum products, a situation that has persisted over the years, prompting concern within the industry.
Nearly two decades ago, there was a surge in applications for refinery licenses under former President Olusegun Obasanjo’s administration. Subsequent licenses were also granted during President Muhammed Buhari’s tenure, amassing a total of approximately 62 licenses, theoretically boosting the country’s refining capacity to over 2.3 million barrels per day.
However, the operational refineries presently in existence, including Dangote, BUA, NNPC Limited, OPAC, Walter Smith, Aradel, and Edo refineries, collectively contribute about 1.322 million barrels per day. Additionally, there are several other refinery licenses, mainly modular ones, with an estimated capacity of nearly one million barrels per day, albeit their operational status remains unclear.
Despite the petroleum market’s shift towards Africa, particularly Nigeria, as European refineries begin to close down, stakeholders suspect that a considerable number of license holders lack genuine intentions to engage in crude oil refining.
While the Nigerian National Petroleum Corporation (NNPC) claimed a 77% completion rate for the refurbishment of its refinery last month, industry stakeholders believe the state-owned oil company’s efforts may not translate into substantial progress and are merely for public display.
