Dangote Refinery To Start Operation In October At 370,000bd Of Diesel, Jet Fuel

-To Receive First Crude Cargo In Two Weeks

The Dangote Refinery reportedly will receive its first cargo of crude in the next two weeks and will begin producing up to 370,000 barrels per day (p/d) of diesel and jet fuel in October.

S&P Global Commodity Insights reported that Dangote Group Executive Director Devakumar Edwin, as having disclosed this during an interview with it.

It stated that Edwin, who is overseeing the $19.5 billion refinery, gave a detailed production timeline, shed light on crude and product flows and laid out a litany of complications and delays to the project since it was first mooted in 2013.

S&P Global Commodity Insights is a provider of energy and commodities information and a source of benchmark price assessments in the physical commodity markets.

Edwin said. “Right now I’m ready to receive crude. We are just waiting for the first vessel. And so as soon as it comes in we can start.”

S&P Global Commodity Insights is a provider of energy and commodities information and a source of benchmark price assessments in the physical commodity markets.

The Dangote Refinery at its full planned capacity of 650,000 b/d would make Nigeria self-sufficient in petroleum products and provide more for export.

Currently, Nigeria imports all its refined products, eroding its foreign exchange reserves. Yet delays and cost overruns led many to question whether Aliko Dangote — Africa’s richest man — would ever deliver. Meanwhile, fuel prices have skyrocketed in Nigeria after President Bola Tinubu announced the removal of petrol subsidy on May 29, 2023.

Edwin said the refinery, which was officially inaugurated in May 22, 2023, by the outgone President, Muhammadu Buhari, will launch in phases, beginning with 350,000-370,000 b/d of diesel and jet fuel by October, when the crude distillation unit, sulfur block and hydrogen plant should be online.

He added that on November 30, the refinery will start the phased ramp-up to 650,000 b/d, around half of its fuel.

Edwin said that though the refinery was designed to process light sweet Nigerian crude, the Nigerian National Petroleum Company Limited which is a shareholder in the project, cannot supply the refinery until November.

He added that consequently, Dangote is buying oil from trading houses.

Edwin said, “At the last minute [NNPC] said, ‘We have actually committed our crude on a forward basis to someone else’, so immediately they don’t have the crude. This is a temporary issue, and the refinery should run on exclusively Nigerian crude by November.

He further said that Nigerian oil will be purchased in US dollars, not naira as some reports had suggested, because it is located in a free zone on the outskirts of Lagos.

It also reported that NNPCL will supply some crude at knockdown prices due to its equity stake.

Edwin said the scale of the refinery meant being “solely dependent on Nigerian crude would not be advisable”. The publication analysed that this meant that the refinery could process most African crudes — apart from heavy Angolan grades — as well as Middle Eastern Arab Light and even US light tight oil.