Festus Keyamo announces that airline operators will soon start sourcing Jet-A1 fuel from Dangote Refinery, marking a new era in aviation fuel procurement.
Festus Keyamo, the Minister of Aviation and Aerospace Development, has revealed that Nigerian airline operators have agreed to start buying Jet-A1 fuel from the Dangote Refinery. This pivotal decision is anticipated to lower air ticket prices nationwide, providing relief for travelers affected by escalating air travel costs.
During an appearance on Channels Television’s Political Paradigm, which aired on Tuesday, Keyamo revealed that the agreement between the airlines and Dangote Refinery is part of a wider strategy by the Nigerian government to address the high cost of aviation fuel. This issue has significantly contributed to rising airfares in recent years.
Effect on Air Travel
Jet-A1, the fuel used in aviation, represents a major part of an airline’s operational costs. As global oil prices continue to rise and local refining options remain limited, Nigerian airlines have faced challenges managing these increasing expenses. Consequently, they have transferred these financial burdens onto passengers by raising ticket prices, thus making air travel less affordable for the average Nigerian.
The Dangote Refinery, recognized as the largest single-train refinery worldwide, can process 650,000 barrels of crude oil daily. This capability is anticipated to revolutionize Nigeria’s energy sector by decreasing its reliance on imported petroleum products. With Jet-A1 being sourced locally from this refinery, Nigerian airlines could see a reduction in fuel expenses, potentially leading to lower ticket prices for travelers.
Keyamo emphasized the advantages of this change, saying, “This creates a win-win scenario for both airlines and passengers. Purchasing from Dangote Refinery allows airlines to obtain more affordable Jet-A1 fuel, which will naturally lower operational costs and ultimately reduce ticket prices.”
Alleviating Stress on Foreign Exchange
Another key advantage of this agreement is the alleviation of pressure on Nigeria’s foreign exchange reserves. In the past, airlines were required to import Jet-A1 fuel or purchase it from international suppliers, which necessitated payments in foreign currency. This added strain to Nigeria’s forex reserves since airlines had to convert naira into dollars for their fuel transactions.
With the domestic production of aviation fuel by Dangote Refinery, airlines can pay in naira, reducing the need for foreign exchange. Consequently, this could enhance economic stability and lead to a more favorable exchange rate for the naira.
Optimistic Future for Nigerian Aviation
Keyamo conveyed confidence in the future of Nigeria’s aviation sector, highlighting that partnering with Dangote Refinery is one among several reforms aimed at enhancing sustainability and affordability within the industry. He stressed the government’s dedication to keeping air travel accessible for all Nigerians, particularly given the challenges associated with road travel due to infrastructure issues.
“Affordable air travel is crucial for Nigeria’s economic growth and the efficient movement of people and goods nationwide. This collaboration with Dangote marks a significant step forward,” concluded Keyamo.
With Nigerian airlines shifting to locally sourced Jet-A1, passengers can anticipate more cost-effective and efficient air travel experiences in the upcoming months.
