The Federal Government, through the Nigerian Midstream and Downstream Petroleum Authority (NMDPRA), has issued licences for nine modular refineries as part of an ongoing effort to expand Nigeria’s refining capacity. The announcement was made by NMDPRA Chief Executive Farouk Ahmed at the 2024 Oil Trading & Logistics Africa Downstream Energy Week in Lagos on Monday.
The licences, issued under President Bola Tinubu’s administration, signify a notable increase in Nigeria’s refining capacity, bolstered by the addition of the Dangote Refinery to the nation’s energy infrastructure. “Our refinery sector has been expanding rapidly with the issuance of nine licences to establish, seven to construct, and four to operate modular refineries,” Ahmed stated.
Ahmed highlighted that over the last year, NMDPRA has revised and consolidated regulatory processes through stakeholder engagement to streamline compliance and improve ease of business. “Over the course of the last year, the NMDPRA has revised and consolidated its regulations through strategic industry stakeholder engagements with a view to streamlining the regulatory framework for ease of doing business and compliance. This is complemented by the issuance of relevant guidelines on automation for processes to strengthen regulatory clarity and enhance compliance,” he said.
Acknowledging President Tinubu’s role in enhancing Nigeria’s energy sector, Ahmed praised the administration’s sectoral policies over the past 18 months, which have turned Nigeria into an attractive investment destination for oil and gas. The NMDPRA head affirmed the government’s goal of achieving 3 million barrels of crude oil production per day and a target of 10 billion standard cubic feet of gas per day for domestic use.
“Indeed, the Nigerian petroleum industry collector has all the complements of enabling structures to facilitate its growth and success. The NMDPRA is fully committed to supporting all the reform initiatives of Mr President and the mainstream and downstream subsector through enhanced regulatory processes, including efficient issuance of licences, permits, and provisions,” Ahmed declared.
Ahmed noted the significant transformations underway in Nigeria’s petroleum market toward liberalisation. “Our inspired target is to achieve a fully liberalised and mature market for all petroleum products and natural gas, where the market fundamentals lead to robust price discovery and attractive investment opportunities,” he added. The government’s energy policy is deepening market liberalisation through robust policies and incentives, encouraging both domestic and international investment.
Ahmed also announced that the Dangote Refinery, which began producing select petroleum products in early 2024, is now supplying Premium Motor Spirit (PMS) as of September 2024. “The refinery commenced production and supply of Premium Motor Spirit in September 2024. It is expected that supply from the factory will improve significantly when it is fully completed and licensed,” he noted.
The NMDPRA also emphasised the agency’s engagement with stakeholders to develop a pricing framework for Liquefied Petroleum Gas (LPG) that will make cooking gas more affordable and accessible to Nigerians. “NMDPRA will engage stakeholders in development of a domestic LPG pricing framework in order to make the product readily available and affordable for the consumers. With regards to alliances, we will continue our quarterly domain-specific engagements with key stakeholders and on-demand engagements with other relevant parties to address ongoing and emerging concerns,” Ahmed said.
Through these initiatives, Ahmed reaffirmed that the Federal Government is committed to furthering liberalisation and fostering investment in Nigeria’s energy market, ensuring that the sector continues to grow and meet the nation’s energy needs.