Banks move to lend NNPC $19b for Dangote refineries equity

Banks have commenced discussions with the Nigerian National Petroleum Corporation (NNPC) on how to lend the corporation $19 billion to acquire 20 per cent equity in Dangote Petroleum Refinery.

The news about plans to buy equity in the refinery broke over two weeks ago.

But in an interview on Channels Television on Tuesday monitored by The Nation , the Group Managing Director (GMD), Malam Mele Kyari, revealed that NNPC will not spend the Federal Government funds to acquire the equity.

Asked to state the benefits that will be accruable to Nigerians when local refineries become operational, he said it will result in the removal of N21 per litre freight cost from the Premium Motor Spirit (PMS) template.

He added that there will be an advantage of proximity of products to the consumers.

The GMD confirmed that the landing cost of petrol was N256 per litre last week.

He insisted that Nigeria does not consume up to 60million litres daily.

Kyari said the consumption was in the neighborhood of 52 to 53million litre daily while the borders were shutdown.

According to him, during the Covid-19 lockdown, it reduced to about 42million litres per day.

He admitted that there are sharp practices in the supply which the corporation is battling to tackle.

Kyari stressed that “more importantly, you have what is called cross-border smuggling of petrol which is associated with the pricing of petroleum itself”.

He explained that the smugglers are taking advantage of the subsidizing of the petrol price to smuggle it to where it is more expensive.

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