The Dangote refinery which is scheduled to take off next year will not sell fuel at a price lower than how it is sold in the international community.
This was disclosed by the Minister of Finance, Budget and National Planning, Zainab Ahmed, while speaking on a programme on NTA.
According to her, the refinery will not reduce cost of fuel despite refining crude oil locally.
She said: “What we are doing is enabling the petroleum sector to actually grow. There have been a number of refineries that have been licensed for several years. None of them was willing to start refining under the regime that we had, where fuel price was controlled.
“The Dangote refinery is sitting within an Export Processing Zone in Lagos, so they are insulated from that. When we buy fuel from Dangote, we will be buying fuel at the international market price.
‘’The only savings that we will be making is the savings of freight which is shipping. We will not be paying for shipping cost.
“But we will still have landing cost, labour cost, and the marketers will still have to put a margin. The refineries that are supposed to have come into operation can now come in because they are assured that when they produce, they can sell at market rate and recover their investments and make some reasonable profits.”
She added that the deregulation of the downstream sector is good for the economy because it will encourage investment in the oil sector.
She said, “It will mean more refineries will open, they will employ people and fuel will be available in different parts of the country and not just relying on government refineries.
“The government refineries are old and even if we turn them around, we will not be able to operate them at optimal capacity, so while the NNPC is trying to rehabilitate them, we also need to encourage the private sector refineries to come on stream and even state governments that have the capacity.”
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