PENGASSAN urges more NNPCL stake in Dangote Refinery to strengthen energy security

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PENGASSAN urges more NNPCL stake in Dangote Refinery to strengthen energy security

  • By Chukwuma Umeorah

The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has urged the Federal Government, through the Nigerian National Petroleum Corporation Limited (NNPCL), to increase its stake in the Dangote Refinery to at least 45 percent from its current 7.2 percent equity.

The union made this call during a press conference held in Lagos, stressing that a higher shareholding by NNPCL would not only strengthen the government’s influence on strategic decisions but also ensure long-term energy security for the country while stabilizing the downstream petroleum sector.

NNPCL had initially aimed to acquire a 20 percent stake in the refinery as part of a $2.7 billion investment plan. However, due to challenges in meeting the financial obligations tied to the agreement, it ended up with only 7.2 percent equity.

President of PENGASSAN and Trade Union Congress (TUC), Festus Osifo, noted that increasing NNPCL’s stake to a minimum of 45 percent would give the government a stronger negotiating position while maintaining private sector efficiency.

“Today, in NLNG, the government owns 49 percent, but things are working just fine in the sector. Holding between 45 and 49 percent gives us energy security assurance. For instance, if the price tomorrow is not right, Dangote can decide to export all his products to sell. “But if Government owned 45 per cent, they can say ‘okay, you take your 51 percent out and give us our 45 percent. “So, this will shore up our energy security by ensuring that, at every point in time, there is always a substantial volume of petroleum products in the country,” he explained.

Osifo clarified that PENGASSAN was not advocating for the government to seek a majority stake in the refinery, but rather to adopt a similar model used in Nigeria Liquefied Natural Gas (NLNG) Limited, where the government holds a 49 percent stake, while private stakeholders control the remaining. This approach, he said, allows for balanced decision-making without jeopardizing operational efficiency.

“Having a minority but substantial stake would prevent scenarios where private operators might prioritize profit over national interests,” Osifo added, highlighting the risk of exclusive reliance on a single operator for national fuel needs.

The union further urged the government to implement the same 49-51 percent strategy for Nigeria’s state-owned refineries when they are fully rehabilitated, allowing 51 percent ownership by private investors.

The PENGASSAN boss stressed that the swift rehabilitation of the nation’s refineries including the Port Harcourt, Warri, and Kaduna facilities would reduce Nigeria’s dependence on imported petroleum products and cut down on forex outflows.

“Relying on a single refinery is not sustainable. If the government can successfully revamp our domestic refineries, we can ensure a robust energy supply that is less vulnerable to external shocks and price fluctuations,” Osifo noted.

He however expressed that while the rehabilitation efforts in these refineries are ongoing, there is no clear timeline for when they will resume full operations.

 

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