As part of efforts to reduce the cost of Premium Motor Spirit (PMS), commonly known as petrol, Nigeria’s neighbouring country Ghana has expressed readiness to start buying from Dangote Refinery in the first quarter of 2025.
Chairman of the National Petroleum Authority Ghana, Mustapha Abdul-Hamid announced this at the Oil Trading and Logistics (OTL) Africa Downstream Oil Conference held in Lagos, Nigeria.
Abdul-Hamid categorically said that Ghana will purchase fuel from Nigeria once the Dangote refinery begins operation fully.
According to him, the projected 650,000bpd daily production is too much for Nigerians to consume. Hence, Ghana could benefit from the surplus production, allowing both countries to collaborate more closely in the energy sector.
Currently, importing petrol from Rotterdam has made fuel prices relatively high in Ghana due to unfavorable exchange rates.
“If the refinery reaches its 650,000 bpd capacity, all that volume cannot be consumed by Nigeria alone, so instead of us importing as we currently do from Rotterdam, it will be much easier for us to import from Nigeria, which I believe will help bring down our prices,” Abdul-Hamid stated.
By sourcing petrol from Nigeria, Ghana hopes to mitigate logistic costs and benefit from a more favourable pricing structure.
Ghana buys $400 million worth of petrol from Europe monthly, which over the years has impacted the commodity pricing in the West African country.
Abdul-Hamid further said the volatility of the Ghanaian cedi against foreign currencies led to increased costs for fuel.
Additionally, buying from a neighboring country would reduce the exchange rate impact on petrol prices, significantly lower fuel costs, and reduce the prices of other goods.
“The reduction in freight expenses would help bring down the prices of various goods, positively impacting Ghana’s broader economy,” he concluded.
