Barely a few hours after the management of the Nigerian National Petroleum Company Limited (NNPCL) reeled out data on its investment stake in Dangote Refinery and Petrochemicals Company Limited, the management of the recently opened refinery flawed the NNPCL’s claims, saying they do not represent all the facts about its investment in the facility.
Dangote Group’s Chief Branding and Communications Officer (CBCO), Anthony Chiejina, categorically stated that it was inaccurate for the state-controlled oil company to claim that it facilitated a $1 billion investment amid liquidity challenges.
According to the firm’s spokesperson, like all business partners, NNPCL invested $1 billion in the refinery to acquire an ownership stake of 7.24% that is beneficial to its interests.
He clarified: “We would like to clarify that this is a misrepresentation of the situation as $1bn is just about 5 per of the investment that went into building the Dangote Refinery.
“Our decision to enter into a partnership with NNPCL was based on recognition of their strategic position in the industry as the largest off-taker of Nigerian crude and at the time, the sole supplier of gasoline into Nigeria.
“We agreed on the sale of a 20 per cent stake at a value of $2.76 billion. Of this, we agreed that they will only pay $1 billion while the balance will be recovered over a period of 5 years through deductions on crude oil that they supply to us and from dividends due to them.
“If we were struggling with liquidity challenges we wouldn’t have given them such generous payment terms. As at 2021 when the agreement was signed, the refinery was at the pre-commission stage.
“In addition, if we were struggling with liquidity issue, this agreement would have been cash based rather than credit driven.
“Unfortunately, NNPCL was later unable to supply the agreed 300 thousand barrels a day of crude given that they had committed a greater part of their crude cargoes to financiers with the expectation of higher production which they were unable to achieve.
“We subsequently gave them a 12-month period for them to pay cash for the balance of their equity given their inability to supply the agreed crude oil volume. NNPCL failed to meet this deadline which expired on June 30th 2024”, Chiejina added.
According to him, in view of its failure to meet the deadline, NNPCL equity share was revised down to 7.24%, pointing out that “it is, therefore, inaccurate to claim that NNPCL facilitated a $1 billion investment amid liquidity challenges.
“Like all business partners, NNPCL invested $1 billion in the Refinery to acquire an ownership stake of 7.24 per cent stake that is beneficial to its interests.
“NNPCL remains our valued partner in progress and it is imperative for all stakeholders to adhere to the facts and present the narrative in the correct context, to guide the media in reporting accurately for the benefit of our stakeholders and the public”, the Group CBCO added.
Earlier, the NNPCL’s Chief Corporate Communications Officer, Olufemi Soneye, had disclosed that the company assisted Dangote Group to get the refinery operational while speaking at an Energy Relations Stakeholder Engagement in Abuja.
Soneye said under the visionary leadership of Mele Kyari, NNPC Ltd had achieved groundbreaking milestones, redefining the trajectory of Nigeria’s oil and gas sector.
He said “In a historic achievement, NNPC, under Kyari’s leadership, declared profit for the first time in decades, marking a significant financial turnaround. The company has already exceeded its profit projections for 2024, a testament to the transformative reforms it has implemented.
“Additionally, Kyari facilitated the $3 billion Gazelle loan, a critical intervention that helped stabilize the federation during a challenging foreign exchange crisis.
“As a responsible energy company, NNPC Ltd continues to strengthen Nigeria’s energy sector while solidifying its legacy as a transformative force and a global game-changer.
“Energy relations are the backbone of NNPC Ltd’s operations and strategic aspirations as an integrated energy company.
“In a rapidly evolving global energy landscape, fostering strong relationships with stakeholders across the value chain is not just a priority but a necessity for achieving our objectives and ensuring energy for today and tomorrow”, Soneye assured.
