29/03/2025
Nigeria’s Energy Sector: Government Control vs. Private Monopoly – A Perspective by Prof. Engr. Dr. Kailani Muhammad
The energy sector is a critical national asset that should remain under government oversight to ensure stability, unlike other industries that can be left to private enterprises. According to Professor Engineer Dr. Kailani Muhammad, allowing petroleum supply to be dominated by private entities risks creating artificial shortages and economic instability. He argues that the Nigerian National Petroleum Company Limited (NNPC) must remain the backbone of fuel distribution to prevent crises.
Dangote Refinery’s Controversial Role
Dr. Kailani highlights the ongoing tensions between Dangote Refinery and NNPC, tracing back to the refinery’s early development. Despite receiving a waiver license from NNPC during construction, Dangote Refinery operated at just 40% capacity, with key components like the Fluid Catalytic Cracker (FCC) non-functional. Instead of resolving these inefficiencies, Dangote allegedly launched a media campaign against NNPC’s management, particularly targeting Group CEO Dr. Mele Kyari.
“This wasn’t just a fight against NNPC—it was a fight against the Federal Government,” Dr. Kailani asserts. He commends President Bola Tinubu for recognizing NNPC’s pivotal role and dismissing what he calls “baseless accusations.”
Failed Crude-for-Product Agreements
A major point of contention is the naira-denominated crude supply deal between NNPC and Dangote Refinery, initiated six months ago. NNPC reportedly supplied 12 vessels of crude daily, yet Dangote failed to meet its obligation of delivering 25 million liters of refined products per day to NNPC.
Dr. Kailani reveals:
Initial supply: 15 million liters/day
Subsequent drops: 10 million → 4 million → 2 million liters/day
A breached 1-billion-liter PMS contract, where Dangote slashed prices after NNPC’s payment, causing massive losses.
“This predatory pricing harms competitors,” he explains. “When marketers buy products, Dangote suddenly crashes prices, leaving them stranded at a loss.”
Global Precedents vs. Dangote’s Monopoly Ambitions
Dr. Kailani dismisses the notion that Nigeria should depend solely on Dangote for fuel, citing global examples:
The U.S., France, China, and even Saudi Arabia (ARAMCO) import fuel despite having refineries.
No nation fully privatizes its oil sector—energy security is a government mandate.
He also debunks a viral social media stunt comparing NNPC and Dangote’s fuel quality:
NNPC’s fuel undergoes additive blending, achieving 75%+ efficiency.
Dangote’s fuel appears watery and kerosene-like, raising quality concerns.
Call for Transparency & National Unity
Dr. Kailani urges Dangote to collaborate with NNPC as a national asset rather than undermining it. Despite NNPC’s support—including naira-based crude sales—Dangote’s fuel prices remain high (₦860/liter vs. a projected ₦500).
He calls for:
Government intervention to monitor imports from customs to filling stations.
Debt settlement via crude oil exports for marketers affected by dollar scarcity.
Patriotism from oil marketers, who have profited for 20+ years, to prioritize national stability.
Conclusion: A Plea for Collective Progress
“We aren’t attacking Dangote—we’re advising responsible conduct for Nigeria’s growth,” Dr. Kailani emphasizes. He stresses the need for all stakeholders, including NNPC and private players, to work together to alleviate Nigerians’ suffering and position the country as a respected energy hub.
“The government must act decisively,” he concludes. “Only through unity, transparency, and fair competition can Nigeria’s energy sector thrive.”
