Subsidy: FG may purchase imported Dangote gasoline for N236 billion each month.
The Premium Motor Spirit, often known as gasoline, that is imported through the Nigerian National Petroleum Company and that which is exclusively off-taken by NNPC from the Dangote Petroleum Refinery may be subsidised by the Federal Government for a monthly cost of approximately N236 billion.
Alhaji Aliko Dangote, the president and chief executive of the Dangote Group, urged the federal government to fully discontinue fuel subsidies on Monday.
Supported by the Independent Petroleum Marketers Association of Nigeria and the Center for Promotion of Public Enterprise on Tuesday, he claimed that the removal will help ascertain the nation’s true gasoline usage.
This occurred when it was learned that over the previous week, members of the Nigerian Major Energies Marketers Association had removed more than 50 million liters of PMS from the Dangote refinery.
It was determined that the product was being subsidized by the government through the national oil company based on the disclosures made by significant oil marketers on the price at which NNPC purchased the product from Dangote and the cost of Dangote gasoline supplied to them by NNPC.
Significant oil traders said that NNPC had sold them the product for N766 per litre, even though NNPC had previously claimed to have purchased the commodity from the Dangote refinery for N898 per liter.
This suggests that the business gave the marketers a N132/litre subsidy on the product.
On September 15, 2024, Dangote announced that it will begin releasing PMS into the domestic market and that it would supply 25 million liters of gasoline per day to the Nigerian market.
This indicates that the NNPC is paying a daily subsidy of almost N3.3 billion, and in 30 days, it would have to pay N99 billion to marketers to subsidize Dangote gasoline.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority recently provided a statistic on the amount of gasoline imported into Nigeria. Although there are differing estimates regarding the precise amount of PMS used, the total was approximately 45.7 million liters per day.
