NNPCL Refineries Underperforming: DAPPMAN Raises Alarm Over Petrol Production

The Nigerian downstream petroleum sector is facing fresh scrutiny as the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) has revealed that refineries operated by the Nigerian National Petroleum Company Limited (NNPCL) are not producing sufficient petrol to meet national demand. This disclosure comes at a critical time when the country continues to navigate the complexities of its energy transition journey and fuel supply dynamics.

Current Production Realities

According to DAPPMAN's assessment, despite the much-publicized rehabilitation of Nigeria's refineries and the recent commencement of operations at the Dangote Refinery, domestic production of Premium Motor Spirit (PMS), commonly known as petrol, remains significantly below the nation's consumption requirements. This production shortfall continues to necessitate substantial imports to bridge the supply gap.

"The current output from operational refineries simply cannot satisfy our national demand," stated a senior DAPPMAN official. "While we acknowledge the progress made in rehabilitating some facilities, the reality is that Nigeria remains heavily dependent on imported petroleum products to meet daily consumption needs."

Industry data suggests that Nigeria's daily petrol consumption hovers around 60 million litres, a volume that domestic refineries are currently unable to match consistently.

Implications for Energy Security

This persistent production deficit raises important questions about Nigeria's energy security and the effectiveness of recent investments in refinery rehabilitation. For decades, Nigeria has faced the paradox of being a major crude oil producer while simultaneously being one of the world's largest importers of refined petroleum products.

The continued reliance on imports exposes the Nigerian market to international price volatilities and supply chain disruptions, factors that have historically contributed to fuel scarcity episodes across the country. Energy experts note that achieving self-sufficiency in refined petroleum products remains critical for Nigeria's economic stability and energy security.

The Promise vs Reality of Local Refining

Recent years have witnessed significant developments in Nigeria's refining landscape, including:

• The rehabilitation of the Port Harcourt Refinery at considerable cost
• The commencement of operations at the 650,000 barrels per day Dangote Refinery
• The proliferation of modular refineries across the Niger Delta region

Despite these developments, DAPPMAN's assessment indicates a substantial gap between expected and actual production outputs. Industry watchers attribute this to various factors, including technical challenges in rehabilitated facilities, logistical issues in crude supply to refineries, and the complex regulatory environment governing Nigeria's petroleum sector.

The Role of Independent Marketers

DAPPMAN's disclosure highlights the continued importance of independent marketers in Nigeria's fuel supply architecture. Even with increased domestic refining capacity, the association emphasizes that a robust distribution network remains essential for effective nationwide fuel delivery.

"Independent marketers continue to play a crucial role in ensuring last-mile delivery of petroleum products across Nigeria," noted the DAPPMAN representative. "Our members' infrastructure, including thousands of retail outlets and storage facilities, remains indispensable to the sector's functionality."

The association has repeatedly called for a level playing field that would enable its members to participate more equitably in the importation and distribution of petroleum products alongside the NNPCL.

Policy Recommendations and Way Forward

Against the backdrop of these challenges, DAPPMAN has proposed several policy interventions to address the persistent supply gaps:

1. Enhanced Public-Private Partnership: Strengthening collaboration between NNPCL and independent marketers to optimize the petroleum product supply chain.
2. Transparent Access to Foreign Exchange: Ensuring equitable access to forex for all qualified marketers to facilitate product importation while domestic refining capacity grows.
3. Regulatory Consistency: Establishing stable regulatory frameworks that encourage long-term investments in refining and distribution infrastructure.
4. Infrastructure Development: Accelerating investments in critical infrastructure including pipelines, storage facilities, and jetties to reduce distribution bottlenecks.

Looking Ahead

As Nigeria continues its journey towards self-sufficiency in petroleum product refining, the insights provided by DAPPMAN serve as a reality check on the current state of the sector. While significant strides have been made, the path to energy independence clearly requires sustained effort, realistic planning, and collaborative approaches among all stakeholders.

The coming months will be critical in determining whether increased coordination between government authorities, NNPCL, private refineries, and independent marketers can successfully address the persistent gaps in Nigeria's petrol production and distribution landscape. What remains clear is that achieving true energy security will require more than rehabilitated refineries – it demands a holistic transformation of the entire petroleum value chain.