Dangote Petroleum Refinery commenced production

Africa's largest crude oil refinery, Dangote Petroleum Refinery, began production in January this year. The refinery has commenced refining and supplying diesel and aviation fuel.

The factory was inaugurated on May 2, 2023, situated in Lekki, east of Lagos, Nigeria. The refinery, when fully operational, is expected to have the capacity to process about 650,000 barrels of crude oil per day, making it the largest single-train refinery in the world.

The factory did not kick off operation immediately after inauguration but has officially begun production this year after surviving licensing issues and allegations against the leadership of the Dangote Group (owner of the refinery).

In an event to commemorate the production, President of Dangote Group, Alhaji Aliko Dangote, elatedly thanked President Bola Ahmed Tinubu for his support, encouragement, and thoughtful advice towards the actualization of this project.

Dangote also thanked the Nigerian National Petroleum Company Limited (NNPC Limited), the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), and Nigerians for their support and belief in the historic project.

“This is a big day for Nigeria. We are delighted to have reached this significant milestone. This is an important achievement for our country, as it demonstrates our ability to develop and deliver large capital projects. This is a game changer for our country, and I am very fulfilled with the actualization of this project.” Dangote said in his speech.

With a capacity of 650,000 barrels per day, the $20 billion refinery promises to ease oil producer Nigeria's costly reliance on imported oil products.

Aliko Dangote, CEO of Dangote Group and Africa's richest.

Mr. Devakumar Edwin, a vice president at Dangote Industries Limited, stated that they are currently testing their gasoline product and plan to begin transferring it into storage tanks soon. However, he did not specify when it would be available in the local market.

Edwin mentioned that Nigeria’s state-owned oil company, NNPC Ltd., which is currently the only gasoline importer in the country, will be the sole buyer of the fuel. He added that if domestic demand doesn't materialize, they will continue exporting the gasoline, just as they’ve been doing with jet fuel and diesel.

Introducing this gasoline into the Nigerian market is expected to help ease the burden on NNPC, which has been struggling with a $6 billion debt to oil traders since January. This debt has impacted its capacity to supply fuel locally, leading to persistent fuel shortages since July.

Fuel prices have surged by 45% from the official rate of 617 naira ($0.3942), set after fuel subsidies were removed last year.

Despite being Africa’s leading oil producer, Nigeria still imports nearly all of its fuel due to longstanding neglect of its domestic refineries.

The Dangote Group, owner of the refinery, is a diversified and fully integrated conglomerate with an annual group turnover in excess of US$4 billion (2016) with vibrant operations in Nigeria and Africa across a wide range of sectors, including cement, sugar, salt, condiments, packaging, energy, port operations, fertilizer, and petrochemicals.

The core business focus of the industry is to provide local, value-added products and services that meet the ‘basic needs’ of the populace through the construction and operation of large-scale manufacturing facilities in Nigeria and across Africa.

The conglomerate is focused on building local manufacturing capacity to generate employment, reduce capital flight, and increase local value addition.