Dangote Refinery's Viability Tied to Subsidy Removal

The Federal Government, represented by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, announced that the Dangote Petroleum Refinery would not have been able to start operations under the petrol subsidy regime. During a presentation in Abuja on Wednesday, Oyedele argued that the removal of the petrol subsidy was necessary to establish a viable market for private refining investments.

He linked the refinery's survival to the subsidy removal, stating that it could not be commercially viable if petrol remained subsidized at less than N200 per litre. Oyedele explained that maintaining petrol at that price would lead to scarcity, forcing consumers to seek fuel on the black market at prices around N3,000 per litre.

He noted that the previous subsidy regime was unsustainable due to the government's fiscal pressures and foreign exchange shortages, which hindered the importation of petroleum products. Oyedele highlighted that the government was spending nearly 100% of its revenue on servicing debts, indicating a dire economic situation.