Ademola Adigun, a seasoned oil and gas expert, has weighed in on the ongoing debate surrounding Dangote Refinery's struggles to access crude oil in Nigeria. Adigun emphasized that it is not the responsibility of the Nigerian government to provide crude oil for the refinery, but rather the duty of the refinery to secure its supply chain.
Adigun noted that like any other business, Dangote Refinery must guarantee its supply chain before commencing operations. He emphasized that the refinery's location in an export processing zone means it is not technically part of the Domestic Crude Supply Obligation (DCSO) framework, which prioritizes local supply.
The expert attributed the recurring fuel scarcity in Nigeria to disruptions in the supply chain, and described the Nigerian National Petroleum Company (NNPCL) as a victim of government policy. He explained that NNPCL is mandated to import fuel as a last resort to ensure price and supply stability, but this obligation can lead to complications.
Adigun highlighted the existence of the DCSO policy within the Petroleum Industry Act (PIA), which prioritizes local supply. He clarified that Dangote Refinery is not technically part of this framework due to its location in an export processing zone.
In summary, Adigun's expert insights underscore the importance of supply chain security for businesses and the need for clarity on policies governing the oil and gas sector in Nigeria."