The marginal rise in crude oil production in June 2024 increased Nigeria’s earnings from crude oil sales by about N91bn in the same month.

Latest oil production data obtained from the Nigerian Upstream Petroleum Regulatory Commission, an agency of the Federal Government, indicated that Nigeria’s oil production rose from 1,251,494 barrels per day in May to 1,276,159 barrels per day in June, representing an increase of 24,665 barrels daily.

This implies that the country pumped an additional 739,950 barrels of crude oil in 30 days in June.

The average price of Brent, the global benchmark for crude, was $82.25/barrel in June 2024, according to data from countryeconomy.com, an international analytical firm.

Also, the average exchange rate of the United States dollar in June, according to exchangerates.org, was N1,489.88/$.

Therefore by increasing oil production by 739,950 in 30 days, Nigeria’s earnings rose by $60.86m, an equivalent of N90.67bn in the review month.

Further analysis of NUPRC’s data showed how the country’s crude oil production fluctuated in the first half of 2024.

Nigeria produced 1,426,574 barrels of crude oil daily in January, but this dropped to 1,322,208 barrels per day in February and further declined to 1,230,518 barrels in March.

The downward trend was halted in April as the country produced 1,281,478 barrels of crude per day in that month. This was, however, not sustained as crude oil output from Nigeria dropped to 1,251,494 in May, before rising marginally to 1,276,159 in June.

The low crude oil production from Nigeria has remained a source of worry for operators in the oil sector.

Findings by our correspondent, as reported recently, showed that Nigeria failed to meet the crude oil production quotas approved by the Organisation of Petroleum Exporting Countries all through 2022 and 2023 and had been unable to meet those approved since January 2024, worsening the oil supply crisis to indigenous refiners.

OPEC is an intergovernmental organisation that enables the cooperation of leading oil-producing and oil-dependent countries to collectively influence the global oil market and maximise profit.

Refineries in Nigeria, including the $20bn Dangote Petroleum Refinery, as well as modular refiners, have been starved of adequate supply of crude required for the production of refined products such as Premium Motor Spirit, popularly called petrol, Automotive Gas Oil or diesel, and JetA1, otherwise called aviation fuel, among others.

They called on the Federal Government to work harder in partnership with International Oil Companies to ramp up Nigeria’s crude production, stressing that the lack of crude has remained a disincentive to investors, particularly those interested in modular refineries.

However, data obtained from NUPRC indicated that crude oil theft, pipeline vandalism, and force majeure at two key terminals, among others, stopped the country from meeting various OPEC oil production quotas, hence making it tough to get crude to local refineries.

Had Nigeria met its crude production quotas, it would have earned more United States dollars by exporting the commodity. Crude export is Nigeria’s major source of earning foreign exchange required to boost its foreign reserves.

Also, had the country produced enough crude for domestic refining, it would have been able to reduce the cost of refined petroleum products, cut down on the importation of PMS, save the dollars used in importing these products, and create jobs, among other benefits.

However, the Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, recently declared that the government had awarded a $21m contract to meter all 187 crude oil flow stations in Nigeria to properly account for what the country produces and exports.

He also said the government awarded another contract for software to enable the government to monitor the movement of Nigeria’s crude from the point of loading of every cargo in Nigeria up to the cargo’s destination.

Lokpobiri, who disclosed this at a press briefing in Abuja, stated that the initiatives would further give clarity on the volumes of crude produced in-country as well as the amount exported to other nations.

He said, “The Federal Executive Council meeting was held, presided over by Mr President, where we took bold steps to reorganise the oil and gas sector. One of the key approvals by the Federal Executive Council has to do with awarding a contract for the metering of our 187 flow stations across the Niger Delta region of Nigeria by the Nigerian Upstream Petroleum Regulatory Commission.

“NUPRC is the apex regulatory agency or commission for the Nigerian oil and gas upstream sector. As part of our steps to ensure that we have proper accountability, the Federal Executive Council approved the metering of all our production. We have 187 flow stations in the country, and there was a contract awarded for us to meter all the flow stations so that we’ll be able to properly account for what we produce and what we export.

“It’s a major development that has never happened in this country. This project is meant to be completed within six months, within 180 days. And Nigerians must know some of the key steps that this government is taking to ensure that we maximise opportunities that other countries are getting by the availability of oil and gas in Nigeria.”

…Asks NASS to test all available products from standard laboratory to disclaim NMDPRA’s assertions

President of Dangote Group, Aliko Dangote, weekend revealed that Dangote Petroleum Refinery has continued to receive repeated orders for its products from all those who have purchased the same since the commencement of production.

The refinery has so far exported its products to some European countries, Singapore and offshore Lome.

Speaking during a tour of both Dangote Petroleum Refinery & Petrochemicals and the Dangote Fertiliser Limited complex by members of the House of Representatives, Dangote wondered why a regulatory authority, such as the Nigerian Midstream and Downstream Petroleum Regulatory Authority, NMDPRA, that should protect local industries was castigating the latter and even lying in media reports to justify the need to continue importation of dirty fuel into the country.

He said: “I urge you to even set up a committee that will take samples at filling stations and take our own sample because I must tell you that all the test certificates people are flaunting around are fake certificates.

“Where are the laboratories where those tests were conducted? By doing this, you will be able to tell Nigerians the very truth that they deserve to know. De-marketing of a company by a regulator that it is supposed to protect it, is very unfortunate.

“We didn’t know that you were going to ask us to stop by the road and take samples from other filling stations. I didn’t know what you wanted to do until we got here and you requested for a test.

“It is even good that it is your members that went directly to get our samples and I am sure you were shocked by the result. With the result, you can see that we produce the best diesel in Nigeria.”

Dangote openly challenged the regulator, NMDPRA, to compare the quality of refined products from his refinery with those imported, while advocating an impartial assessment to determine what best served the interests of Nigerians.

“We produce the best diesel in Nigeria. It is disheartening that instead of safeguarding the market, the regulator is undermining it. Our doors are open for the regulator to conduct tests on our products anytime, transparency is paramount to us.

“It would be beneficial for the regulator to showcase its laboratory to the world so Nigerians can compare. Our interest is Nigeria first because if Nigeria doesn’t grow, we have limited capacity for growth.

“Speaker and esteemed members, you have witnessed the results of the credibility test. I appreciate your wise counsel in procuring samples from filling stations alongside our refinery’s product.

“Ours shows a sulphur content of 87.6 ppm, approximately 88, whereas the others exceeded 1,800 ppm. Although the NMDPRA permits local refiners to produce diesel with sulphur content up to 650 ppm until January 2025, as approved by ECOWAS, ours is significantly lower.

“Next week, we aim to achieve 10 ppm, aligning with the Euro V standard. Imported diesel is capped at 50 ppm, but as you have seen, those from the stations, imported by major marketers, fall well outside this standard,” Dangote observed.

He pointed out that high-sulphur content diesel regularly imported into the country often came with dubious certifications.

He emphasised that the most effective method to verify the quality was to purchase the product directly from filling stations and conduct credibility tests.

Dangote, who noted that the issue has resulted in both health riss and financial losses for Nigerians, said: “Dubious certifications often accompany the importation of high-sulphur diesel into Nigeria, causing both health risks and financial losses for Nigerians.

“The best method to verify this is to purchase the product directly from filling stations where end-users obtain it. I believe Farouk Ahmed (Chief Executive of NMDPRA) speaks without sufficient knowledge of our refinery.

“We have successfully exported diesel and jet fuel to Europe and Asia without any complaints; in fact, we have received repeated orders, indicating satisfaction with our products.”

Supporting Dangote’s assertion, the Vice President of Gas and Oil at Dangote Industries Limited, Devakumar Edwin, highlighted recent actions by European countries, such as Belgium and The Netherlands.

“These countries have expressed concerns about the carcinogenic effects of high-sulphur diesel being dumped into the Nigerian market, prompting them to impose bans on such fuel exports to West Africa,” he said.

Edwin informed the visiting federal lawmakers that the Dangote Petroleum Refinery, designed to process a wide range of crudes, including various African and Middle Eastern crudes, as well as US Light Tight Oil, conforms to Euro V specifications.

He said further it was designed to comply with US EPA (United States Environmental Protection Agency), European emission norms, Department of Petroleum Resources, DPR, emission/effluent norms, and the African Refiners and Distribution Association, ARDA, standards.

While noting that products from the $20 billion facility are of high quality which met international standards, Edwin said the refinery can meet 100% of Nigeria’s demand for petrol, diesel, kerosene, and aviation fuel, with surpluses available for export.

The Group’s Vice President, Olakunle Alake, expressed disappointment over accusations of monopoly against the Dangote Group, noting that there are multiple players in the industry, including the Nigerian National Petroleum Corporation Limited, NNPC Limited, which operates four refineries.
Expressing concern over the controversy surrounding the quality of imported refined products into Nigeria, Speaker of the House of Representatives, Tajudeen Abass, in his remarks, stated that the Green chamber will establish a committee to investigate the matter thoroughly.

The Speaker also noted that sampled products from various sources would undergo testing as part of this initiative. also expressed admiration for the infrastructure at the Dangote Oil Refinery, describing it as a significant asset in Nigeria’s quest for self-sufficiency in petroleum products.
He noted also that the refinery has positioned itself as a pivotal player, especially at a time global concerns over energy security and sustainability were paramount.

“Today’s visit to the magnificent facilities of Dangote Industries Oil Refinery section has been nothing short of enlightening. It has afforded us a rare opportunity to witness first-hand the monumental strides your organisation has made in transforming the landscape of petroleum production in Nigeria.

“The sheer scale and sophistication of this facility are awe-inspiring; it stands as a beacon of hope for our country as we navigate through the turbulent waters of energy supply challenges,” he said.

Commending the state-of-the-art technology implemented at the petroleum refinery, Abbas praised it as revolutionary and a shining example of engineering and innovation excellence.

He added: “Each corner of this facility resonates with the echoes of hard work, dedication, and an unyielding pursuit of quality. Every drop produced here carries not just oil but also the hopes and dreams of millions who yearn for a brighter future.

“We are deeply impressed by what we have seen during this visit which confirms the rating of this industry as the single largest oil refinery in Africa. This remarkable achievement does not merely reflect corporate success, it symbolises national pride, a tribute to what can be accompanied when visionary leadership meets relentless determination.’’

Acknowledging the numerous challenges likely encountered during the construction of the refinery, the speaker lauded Dangote for his steadfast commitment to achieving excellence.

“I would like to take this opportunity to acknowledge the myriad challenges that have beset this remarkable facility.

“The regulatory hurdles that often loom like dark clouds over progress, the complexities surrounding crude oil supplies that can stifle even the most ambitious endeavours, and the daunting economic landscape we navigate especially in these times when our economy grapples with foreign exchange constraints, are all formidable adversaries.

“Yet, despite these tribulations, your unwavering commitment to excellence shines through,” he said.