The Nigerian National Petroleum Company Limited (NNPC) has stated it’s decision to cease exclusive purchase agreement with Dangote Refinery, opening up the market for other marketers to buy petrol directly from the refinery, report revealed.
This development entails that the company will no longer be the sole off-taker, and marketers can now negotiate prices directly with Dangote Refinery.
This development aligns with the current practices for fully deregulated products, where refineries can sell directly to marketers on a willing buyer, willing seller basis.
Moving the motion, Mr Oforji explained that the exclusion of independent marketers threatened competition in the sector.
He noted that competition is essential for reducing costs, adding that some marketers may resort to importing products to survive in the market.
“NNPCL and the major marketers being the exclusive off-takers spells monopoly, which is tantamount to greed. This is the same NNPC Ltd that has failed to manage our crude and refineries for decades,” the lawmaker said at the time.
Femi Soneye, the spokesperson for the NNPC is not immediately available to input his comment but a top official of the company confirmed the development to PREMIUM TIMES Monday morning.
“Yes, it is true,” the official said. “We can no longer continue to bear that burden.”
However, with NNPC no longer covering the differential between Dangote’s selling price and the price to marketers, subsidies will cease to exist. Marketers will now buy directly from Dangote and sell at cost price, adding their own differential, which may lead to a hike in the product’s price.
(Premium Times)
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