The Chief Executive Officer of Dangote Refinery, David Bird, has raised concerns over what he described as a significant shortfall in crude oil supply under the Federal Government’s crude-for-naira arrangement.
Speaking during an interview on Arise TV on Wednesday, Bird revealed that the refinery has been receiving only about five cargoes of crude oil monthly, far below the expected 13 to 15 cargoes required to sustain operations and meet domestic demand.
According to him, the refinery is currently operating at full capacity, processing approximately 650,000 barrels per day (BPD).
He noted that this output is sufficient not only to meet Nigeria’s fuel needs but also to supply neighbouring countries within the region.
Despite this, Bird expressed concern that the existing crude supply arrangement is not being fully honoured. He explained that the crude-for-naira programme, often misunderstood by the public, is not a subsidy or discounted pricing mechanism but rather a structure based on international market benchmarks, with the added benefit of reducing pressure on foreign exchange.
“The agreement is priced at full international benchmark without the foreign exchange implication, which has helped stabilise the FX market,” he said.
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However, he pointed out that the challenge extends beyond volume to include issues of crude quality allocation, which he said affects the refinery’s efficiency and planning.
Bird called on the government to ensure greater transparency in how crude allocations are determined, stressing that consistent and adequate supply is critical for sustaining production and stabilising Nigeria’s energy market.
The concerns come at a time when Nigeria continues to grapple with fuel supply challenges and price volatility, making the performance of the Dangote Refinery a key factor in the country’s energy security and economic stability.
Industry observers note that any disruption or inconsistency in crude supply to the refinery could have ripple effects on fuel availability, pricing, and broader economic conditions.