Dangote Refinery has said it aims to refine 700,000 barrels of crude oil per day.
The Chief Executive Officer of the Dangote Petroleum Refinery & Petrochemicals (DPRP), David Bird, said this during an interview with journalists in Lagos on Monday.
He reiterated the refinery’s commitment to meeting domestic fuel demand amid global market volatility.
What they are saying
The CEO said that Dangote Refinery is currently running at 650,000 barrels per day but aims to surpass that.
- “We are running at 650,000 barrels a day. In fact, we did a performance test run at 661,000 barrels a day. To get to 700,000, we first have to assure our insurance and market stakeholders.
- “However, we see that we will be able to move to 700,000. And we will have very deliberate management. We are confident we can keep that up to 700,000.
- “But right now, for the purposes of full transparency, we are operating at the nameplate capacity of 650,000 barrels a day,” Bird said.
Get up to speed
Dangote Refinery is expected to get more crude from the Nigerian National Petroleum Company Limited amid global oil volatility.
Nairametrics reported that the Federal Government, through the NNPCL, took steps to secure crude oil supply for the Dangote Petroleum Refinery via third-party international traders to sustain local refining operations.
However, officials warned that Nigerian consumers might not immediately notice a drop in fuel prices, especially given the recent price hikes at the Lekki refinery.
Dangote Refinery needs around 13–14 cargoes of crude per month to operate at full capacity. The NNPC has been supplying about five cargoes a month at best.
The Africa’s largest refinery must buy crude from foreign traders to cope with this shortfall.
Foreign traders create a charged premium around crude, as crude is at an inflated price due to current global tensions.
The Lagos-based refinery claimed to absorb about 20% of the price increase, meaning to soften the blow; however, 80% of that is being passed to the marketers and consequently, the end user.
These price adjustments are driven by global gains stemming from the US-Israeli-Iran conflict, which has kept Brent Crude prices around $115 a barrel. Crude imports were made at replacement costs because of high global prices, and the refinery delays loading to avoid selling at a loss before prices rise again.
What you should know
Owned by African industrialist Aliko Dangote, the refinery is considered a transformative project for Nigeria’s energy sector.
Last year, the refinery said that it does not compete with the Nigerian National Petroleum Company Limited (NNPC Ltd), as the two companies play complementary roles in Nigeria’s energy and refining environment.
It said the refinery was designed to reduce the country’s reliance on imported refined petroleum products while strengthening domestic fuel supply.
The Dangote Refinery is now a central player in Nigeria’s downstream sector, capable of meeting the country’s fuel demand independently of international supply shocks.
