By Pathfinder Reporter
Tuesday May 28, 2024
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Dangote Group chairman, Alhaji Aliko Dangote has said that the Dangote Refinery will import crude oil from the United States because Nigeria’s oil production figures keep fluctuating.
The African richest man made this disclosure while speaking with the Africa Report in a video sighted by The PUNCH.
Dangote said the refinery could not wait for the Nigerian crude because the production goes up and down.
Just as he promised during recent African CEO Summit in Rwanda that his refinery would commence sales of premium motor spirit (petrol) to the marketers in June this year.
He said that Dangote Refinery will put end to the monthly importation of an average of 1 billion litres of petrol in Nigeria when his refinery begin to sell petrol to the marketers.
He said, “following the laid-down plans of the Dangote refinery, Nigeria will no longer need to import petrol starting next month.”
He said, “Right now, Nigeria has no cause to import anything apart from gasoline and by sometime in June, within the next four or five weeks, Nigeria shouldn’t import anything like gasoline; not one drop of a litre,” he declared.
He added, “We have enough gasoline to give to at least the entire West Africa, diesel to give to West Africa and Central Africa. We have enough aviation fuel to give to the entire continent and also export some to Brazil and Mexico.
“We have started producing jet fuel, we are producing diesel, and by next month, we’ll be producing gasoline. What that will do is that, it will be able to take most African crudes.”
The refinery, which is the largest in Africa and Europe when it reaches full capacity, has since commenced the sale of diesel and aviation fuel, but its petrol is yet to hit the market.
In April, Dangote crashed the price of diesel from around N1,500 to N1,000 per litre.
However, Nigerians were eagerly waiting for petrol, which is the major fuel used for transportation and alternative power generators.
Dangote noted that the refinery would attain 500,000 barrels daily capacity by the end of July and its full capacity of 650,000 barrels towards the end of the year.
According to him, the US oil is not being imported to take over that of Nigeria, saying 24 million barrels coming from the US is just two cargoes per month, which represents 10 per cent of the refinery’s demand at full capacity.
“As you know, we are ramping up and I think by July or thereabouts, we will be talking of about over 500,000 barrels per day refining capacity, which is huge. And then, by sometime towards the end of the year, we believe that we will hit our capacity of 650,000 barrels per day. So, it is a very huge capacity.
“The US one (crude oil) is not something that will come and take over Nigeria something. It is not very small. When we say 24 million barrels, it sounds huge, but it is not huge. It is roughly about two cargoes in a month, which is about 10 per cent of our demand at full capacity,” Dangote stated.
A Bloomberg report said the Dangote Refinery was taking advantage of cheaper US oil imports for as much as a third of its feedstock as it started up.
According to analysts, the refinery has been shipping products in recent weeks while readying two units to enable petrol output, which will deliver a long-promised transformation of the fuel market in Nigeria and the region.
“Dangote is going to influence Atlantic Basin gasoline markets this summer and for the rest of the year,” an oil expert, Alan Gelder, told Bloomberg.
According to the average estimate of analysts at WoodMac, FGE, and Citac, the refinery is currently running at about 300,000 barrels a day, nearly half its nameplate capacity.
Reuters recently reported that the Dangote oil refinery could end a decades-long petrol trade from Europe to Africa, worth $17 billion a year.
Reuters, quoting analysts and traders, said the Dangote refinery was heaping pressure on European refineries already at risk of closure from heightened competition.
About a third of Europe’s 1.33mbpd average petrol exports in 2023 went to West Africa, a bigger chunk than any other region, with most of those exports ending up in Nigeria, Reuters said, quoting Kepler data. But this, Dangote assured, would become a thing of the past in June.
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