Page 4 - AfrOil Week 35 2021

AfrOil COMMENTARY AfrOil

Nigerian downstream sector

has another very busy week

The DPR has provided its latest update on active refining permits as Aliko Dangote offers

details on the government’s high-profile acquisition of a stake in his 650,000 bpd facility

NIGERIA’S Department of Petroleum This implies that after the validity period for the
Resources (DPR) has updated its list of private particular milestone, the licence becomes inac-
WHAT: licensed refineries, showing that more than half tive until the company reapplies for revalidation
The DPR’s list showed of the projects approved have active licences. to migrate to another milestone.”
that 30 out of 70 refining Meanwhile, Aliko Dangote shared details of the “This does not in any way translate to rev-
permits issued remained state’s deal to acquire a minority shareholding in ocation of licence of the company,” Osu noted.
active in July. his new refinery and his company provided an Much of the confusion appears to have
update on its integrated petrochemicals facility. stemmed from reference to the permits being
WHY: The latest information flows are indicative “active” or “valid.” In a document given to a local
This means that two of efforts to improve transparency; however, media outlet, The Nation, DPR outlined 70 pro-
permits had expired inconsistencies and the irregularity of updates jects with a total proposed refining capacity of
since the previous has proved more than sufficient to create 3.51mn barrels per day (bpd), but with just 30 of
updates, with another one confusion. these holding active licences as of July, the April
understood to have ended
during July. figure of 32 expired permits has now risen to 40.
Permit update DPR awards four types of permits for private
WHAT NEXT: The list updates a document published by DPR refineries; a two-year licence to establish (LTE),
NNPC will pay for its in April which showed that in March 23 refiner- approval to construct (ATC), approval to relo-
$2.7bn purchase of a ies had valid permits, leading to media reports cate (ATR) and licence to operate (LTO).
20% stake in Dangote suggesting that 32 licences had been revoked. Of the 23 permits that were valid in March,
Refinery with a combina- This prompted the DPR’s head of public affairs, 16 related to facilities with a capacity of 12,000
tion of cash, crude and Paul Osu, to make a statement of clarification: bpd or less, with the outlier being the 650,000
profits. “We wish to clarify that DPR did not revoke any bpd Dangote Refinery under construction in
refinery licence.” Lekki Free Trade Zone, which is working to an
He added that those not included in the pub- end-2021 completion under its ATC.
lished list had expired. “Refinery licences, like Some 35 of the units on the latest list have
our other regulatory instruments, have validity been awarded an LTE, though only 10 of these
periods for investors to attain certain milestones. are active, with the remaining 25 having expired.

P4 www. NEWSBASE .com Week 35 01•September•2021