Business
CRUDE BETRAYAL: Dangote Refinery Pays $18/Barrel Premium as Nigeria Leaks Petrodollars to International Traders — CEO Sounds Alarm Over Allocation Failures
CRUDE BETRAYAL: Dangote Refinery Pays $18/Barrel Premium as Nigeria Leaks Petrodollars to International Traders — CEO Sounds Alarm Over Allocation Failures
By Raymond Gold, Co-Publisher and Research Reporter, Waterways News
Africa’s largest oil refinery is being forced to buy Nigerian crude on international markets at a premium of more than $18 per barrel — a direct consequence of chronic failures in domestic crude allocation that are costing Nigeria hundreds of millions of dollars and keeping fuel prices high for ordinary consumers.
David Bird, Chief Executive of the Dangote Petroleum Refinery, made the disclosure in an interview with ARISE News, revealing that the 650,000-barrel-per-day facility — large enough to meet Nigeria’s entire domestic fuel demand — is currently receiving only five crude cargoes per month under a government-backed supply arrangement, against a pre-agreed contractual volume of 13 to 15 cargoes. “That’s an under performance against that pre-agreed volume contract,” Bird said.
“We’re now paying over $18 per barrel premium for those same Nigerian crude grades. That value is money that Nigeria is leaking to the international trading community.”
A Programme Undermined by Inconsistency
The shortfall strikes at the heart of Nigeria’s Crude-for-Naira programme — a mechanism designed to stabilize the naira by enabling domestic refiners to pay for locally produced crude in local currency rather than dollars. Bird was careful to clarify that the arrangement involves no subsidy or discount; crude is priced at full international benchmark levels. The problem, he stressed, is that the programme’s potential has been badly undermined by inconsistent delivery.
Currently, only 30 to 35 percent of the refinery’s crude requirements are being met through the Crude-for-Naira arrangement, with a further 30 to 40 percent sourced from international markets. While Bird described the facility as a merchant refinery with the flexibility to procure globally, that flexibility carries a cost that ultimately passes through to Nigerian consumers already struggling with elevated pump prices.
Compounding the volume shortfall is a grades mismatch. Bird said the refinery regularly submits detailed crude grade preferences aligned to its specific processing configuration — and routinely fails to receive them.
“Our hardware is designed around a certain crude slate,” he said. “Not only do we not get the full allocation, very often we don’t get the grades that we are highlighting as our preferences.”
A Policy Failure, Not Just a Market Problem
Bird’s remarks amount to a pointed indictment of Nigeria’s crude allocation system, long criticized for opacity, inefficiency and susceptibility to abuse. Nigeria, Africa’s largest oil producer, has battled crude theft, pipeline vandalism and chronic production under-performance relative to its OPEC quota — constraints that have periodically squeezed domestic supply volumes.
On pricing, Bird was candid about the limits of what the refinery can control. All major cost inputs — crude, freight and insurance — are exposed to geopolitical volatility. Referencing current global energy supply chain tensions, he cautioned that even a resolution to ongoing conflicts would leave disruption reverberating through supply chains for months to come.
“This is a cost-of-living crisis,” Bird said. “Every facet of the modern economy is impacted by energy.”
Reserves, Reform and an IPO
Looking ahead, Bird called on Nigerian authorities to adopt a broader view of the operating environment — one that addresses not only crude pricing but the overall cost of doing business in the country. He also advocated for the development of strategic petroleum reserves, warning that the COVID-19 pandemic had exposed dangerous vulnerabilities in global supply chains that neither governments nor industry had fully addressed.
On a more optimistic note, Bird confirmed the refinery is advancing plans for a public listing, positioning it as a wealth-building opportunity for ordinary Nigerians.
“This is the people’s IPO,” he said. “We want it to be one of the most widely subscribed IPOs in the world.”
For now, the more pressing challenge remains securing the crude Nigeria already produces — at prices that do not hand a windfall to international traders. As Bird put it, the problem is as much a policy failure as a market one.
“Our job is to be cost-effective, disciplined and resilient through the cycle,” he said. “What goes up always comes down.”
Nigeria Watch
The Dangote Refinery’s crude supply crisis is a microcosm of a broader dysfunction in Nigeria’s upstream-to-downstream value chain. Every barrel the refinery is forced to buy on international markets at an $18 premium is a barrel’s worth of foreign exchange leaving the country — a direct contradiction of the Crude-for-Naira programme’s naira-stabilization objectives. For Nigerian maritime stakeholders, the freight dimension is equally significant: imported crude cargoes mean more tanker calls, higher bunker costs, and greater exposure to the very global shipping disruptions — including the ongoing Hormuz crisis — that are already pushing freight and insurance rates upward. NIMASA, the NPA and the Federal Ministry of Marine and Blue Economy should be tracking this closely. Securing reliable domestic crude allocation for Dangote is not merely a refining industry issue — it is a shipping, logistics and blue economy imperative.
Business
NIMASA to Launch Mandatory Registration Portal to Curb Foreign Takeover of Nigerian Shipping Agents Business
NIMASA to Launch Mandatory Registration Portal to Curb Foreign Takeover of Nigerian Shipping Agents Business
By Okeoghene Onoriobe, Waterways News Correspondent, Lagos
The Nigerian Maritime Administration and Safety Agency (NIMASA) has announced plans to establish a dedicated Shipping Business and Registration Unit at the Federal Ministry of Marine and Blue Economy, as part of measures to end the growing foreign encroachment into shipping agency operations — a sector long reserved for Nigerian indigenes.
NIMASA Director-General, Dr. Dayo Mobereola, disclosed this during a stakeholders’ engagement meeting organised by the Ministry in Lagos on Thursday.
Dr. Mobereola said the agency had observed with grave concern the increasing penetration of foreigners into aspects of ports and shipping business that are exclusively meant for Nigerian operators, including shipping agency and freight forwarding services — sectors where indigenous practitioners have long raised alarm.
“We need to establish a mandatory registration and licensing portal for Nigerian shipping agents. They would be the only ones with the rights to operate in the Nigerian shipping industry,” the NIMASA boss declared.
He added that the agency had also uncovered a troubling pattern where foreign nationals were registering companies through Nigerian fronts to circumvent existing rules.
“We noticed that these foreigners are registering companies with the assistance of Nigerians. The purpose here is to eliminate such acts and help us develop the Nigerian shipping sector — most importantly the shipping agents sector — to make it more economically friendly and create jobs for Nigerians,” he said.
Dr. Mobereola confirmed that the new department would be established soon, pending approval from the Honourable Minister of Marine and Blue Economy.
The proposed unit is expected to bring structure and legal clarity to a space that industry stakeholders say has been undermined for years by the activities of foreign interests — often operating covertly through proxy arrangements with local collaborators.
Waterways News gathered that the move has been broadly welcomed by indigenous shipping practitioners who have consistently called on regulatory authorities to enforce indigenisation policies in the maritime sector.
Waterways News — Nigeria’s Foremost Maritime Industry Publication | www.waterwaysnews.ng
NPA BOSS: PORT CONCESSION RENEWALS DELAYED FOR THOROUGH REVIEW, NOT NEGLIGENCE
Dantsoho says flawed agreements could create bigger problems; urges ICD operators to adapt to changing market realities
By Okeoghene Onoriobe | Waterways News Correspondent, Lagos
The Nigerian Ports Authority (NPA) has broken its silence on the prolonged delay in renewing seaport concession agreements, attributing the hold-up to an ongoing comprehensive review designed to strengthen contractual frameworks and shore up investor confidence.
Speaking to maritime journalists in Lagos, NPA Managing Director Abubakar Dantsoho said the Federal Government is deliberately prioritising the correction of structural deficiencies in existing agreements before any renewals are approved — a signal that the administration is unwilling to repeat the contractual pitfalls that have dogged Nigeria’s port sector for nearly two decades.
Background: Contracts Running Out
Nigeria’s seaports were handed over to private terminal operators in 2006 under the administration of former President Olusegun Obasanjo, with concession agreements ranging between 10 and 25 years. With many of those contracts now expired or expiring, uncertainty has deepened across the terminal operating community, with concessionaires growing increasingly anxious over the absence of fresh agreements.
“Get It Right” — Dantsoho
Dantsoho acknowledged the frustrations of terminal operators but held firm that quality must take precedence over speed. Both the NPA and concessionaires, he said, have identified unmet obligations on various sides — issues that must be resolved upfront to prevent costly disputes down the line.
“The focus is to get it right. A flawed agreement could create bigger problems later, while a well-structured one will provide long-term stability,” the NPA chief stated.
He also pushed back against the notion that slow processing undermines investor appeal, arguing that serious investors value legal clarity and contractual certainty far more than the pace of execution. A rigorous review, he noted, could even attract fresh investors should any existing operators choose not to renew.
ICD Operators Told to Restrategise
On the question of inland container depots (ICDs) and bonded terminals, Dantsoho issued a pointed advisory: adapt or risk irrelevance. He noted that while such facilities were critical pressure valves during periods of severe port congestion, the progressive easing of gridlock at Nigeria’s major ports has begun to erode the commercial rationale for their current operating models. Operators, he warned, must restrategise to remain competitive in a shifting maritime landscape.
NIGERIA WATCH: What this means for terminal operators, freight forwarders, and port stakeholders
The NPA’s position on concession renewals has far-reaching implications for virtually every layer of Nigeria’s maritime supply chain.
For terminal operators at Apapa, Tin Can Island, and the emerging Lekki Deep Sea Port, the delay introduces commercial uncertainty — investment decisions on equipment, berth upgrades, and staffing are difficult to commit to without clarity on tenure. Some operators are believed to be operating on tacit month-to-month arrangements, a situation that discourages capital expenditure.
For freight forwarders and shippers, stability of terminal operations directly affects cargo handling efficiency, tariff predictability, and turnaround times. Protracted uncertainty at the operator level has a downstream effect on the cost of doing business through Nigerian ports.
The NPA’s hint that new investors could enter if existing concessionaires step aside is significant. It opens the door to fresh capital and potentially more competitive terminal management — but only if the review produces the legally watertight agreements Dantsoho is promising.
On ICDs and bonded terminals, the warning is clear: the congestion-driven business model of the past is fading. As the NPA and the Nigerian Shippers’ Council (NSC) continue to push efficiency reforms, facilities that once thrived on cargo diversion and storage overflow must find new value propositions — whether in last-mile logistics, warehousing, or value-added trade facilitation services.
The Federal Ministry of Marine and Blue Economy and NIMASA will also be watching closely, as the outcome of the concession review will set the template for how Nigeria manages its blue economy assets going forward — and whether the country can finally position its ports as competitive gateways in the West African sub-region.
NSW Opens Apapa Support Centre as Digital Trade Platform Goes Live
By Emetena Ikuku, Waterways News Correspondent
LAGOS — The management of Nigeria’s National Single Window (NSW) has established a dedicated stakeholder support centre at 34 Wharf Road, Apapa, following the go-live of the country’s long-awaited digital trade facilitation platform last Friday.
The NSW platform — a Federal Government initiative to consolidate all port-related documentation and regulatory processes into a single digital environment — launched formally earlier in the week before transitioning to full commercial operations days later, marking a significant shift from pilot-phase testing to live deployment.
Support Centre Targets Smooth Onboarding
The Apapa facility is designed to assist port operators, freight forwarders, customs agents and other stakeholders encountering difficulties navigating the new system. Its location on Wharf Road, at the heart of Nigeria’s busiest port corridor, is intended to ensure ease of access for users operating within the Apapa axis.
Beyond physical walk-in support, the NSW management has activated a multi-channel helpdesk offering assistance via telephone, WhatsApp and email to address operational issues and resolve platform inquiries.
Management urged stakeholders to utilise the available support services, noting that effective onboarding is central to realising the platform’s full trade facilitation potential.
Platform Aims to Cut Cargo Dwell Time
The NSW is engineered to eliminate manual documentation bottlenecks by integrating all port clearance, regulatory and compliance processes under one digital roof. Authorities say full deployment is expected to reduce the cost of doing business at Nigerian ports and accelerate cargo throughput — objectives that have long ranked among the priorities of the Federal Ministry of Marine and Blue Economy.
Nigeria Watch
The go-live of the National Single Window carries direct implications for operators across the Nigerian port ecosystem. At Apapa and Tin Can Island — where manual documentation cycles and fragmented agency interactions have historically inflated cargo dwell times — the platform’s ability to centralise clearance processes could offer meaningful efficiency gains for importers, freight forwarders and terminal operators alike.
For the Nigerian Ports Authority (NPA) and the Nigerian Shippers’ Council (NSC), seamless NSW adoption among port users will be a key indicator of whether the digital trade agenda translates into measurable reductions in port congestion and logistics costs. NIMASA, whose regulatory mandate intersects with vessel and cargo documentation, will also have a stake in the platform’s integration architecture.
Freight forwarding associations and licensed customs agents — many of whom remain accustomed to manual and semi-manual clearance pathways — will likely represent the largest onboarding challenge. The placement of the support centre on Wharf Road, rather than at a government ministry or agency complex, signals a deliberate effort to meet practitioners where they operate.
The NSW’s full commercialisation also arrives against the backdrop of broader port reform efforts, including ongoing concession reviews and the Federal Government’s push to position Nigerian ports as competitive West African trade hubs. Whether the platform achieves critical mass adoption in its early weeks will depend heavily on the responsiveness of the helpdesk infrastructure now being put to the test.
Waterways News | Lagos
-
Oil and Gas4 weeks agoTantita’s Pipeline Deal: $144m Contract, Rising Output, and the Questions that Deserve Answers
-
Blue Economy2 months agoNigeria’s Coast Guard Bill: A Solution in Search of a Problem?
-
Business1 month agoCASABLANCA PORT SHUT DOWN AFTER VESSEL LOSES 85 CONTAINERS — SHIP SERVES NIGERIAN ROUTES