The Dangote Petroleum Refinery is receiving barely a third of the crude oil it is entitled to under the Federal Government’s crude-for-naira arrangement, the refinery’s Chief Executive Officer, David Bird, said on Wednesday.
The shortfall and what it means
Bird made the disclosure during an interview on ARISE News, saying the refinery currently receives only about five crude oil cargoes per month, against an agreed volume of 13 to 15 cargoes.
“What we see under that agreement, we should be getting about 13 to 15 cargoes a month. And that’s what we could process to meet Nigeria’s domestic fuel requirements. Currently, we’re only getting five. So, that’s an underperformance against that pre-agreed volume contract,” he said.
The gap means the refinery is sourcing preferred Nigerian crude grades from the international market at significantly higher costs, a difference Bird said Nigeria is effectively losing.
“That value between the purchase price and the premium that we’re now seeing is money that Nigeria is leaking to the international trading community,” he said.
What the crude-for-naira deal is designed to do
Bird pushed back against the common assumption that the crude-for-naira arrangement was set up primarily to benefit Dangote Refinery.
“Crude for naira is not there to benefit Dangote Refinery. That is a fundamental misunderstanding,” he said. The crude-for-naira programme is designed to provide resilience to the foreign exchange rate. It is the benefit of the country to process domestic crude in the domestic currency.”
Under the arrangement, the refinery purchases crude oil in naira rather than dollars, with the aim of reducing pressure on Nigeria’s foreign exchange reserves and stabilising the naira.
Refinery running at full capacity
Despite the crude supply shortfall, Bird said the facility is currently operating at its full installed capacity of 650,000 barrels per day, supplying both domestic and regional markets.
However, he noted that the Middle East conflict has pushed up operational costs across the board, including freight, insurance, and logistics expenses.
He also confirmed that the refinery operates without subsidies or discounts on its crude inputs, meaning fuel pricing remains tied directly to international market forces.
What Bird is asking for
Bird called for improved crude allocation to the refinery and urged long-term strategic planning, including the building of national petroleum reserves, to strengthen supply chain resilience across Nigeria’s oil sector.
The shortfall in crude supply is significant for ordinary Nigerians. If the refinery cannot consistently process enough local crude to meet domestic fuel demand, it increases the country’s exposure to imported fuel costs — putting further pressure on pump prices at a time when many Nigerians are already struggling with the high cost of living.
The Federal Government and the Nigerian National Petroleum Company Limited have not publicly responded to Bird’s figures. The refinery’s ability to receive its full crude allocation under the crude-for-naira deal is expected to remain a key issue in ongoing negotiations between Dangote and NNPCL.