Dangote refinery imports 12m barrels of US crude in bid to plug local supply gap

NIGERIA'S Dangote Petroleum Refinery is awaiting up to 12m barrels of crude oil from the US as a result of domestic shortages that have plagued the local economy making it hard for the facility to operate at full capacity.

Africa's largest crude oil refinery, the Dangote plant in Lagos State, which started operations early this year, has a 650,000 barrels per day capacity. However, with Nigeria's domestic output way down on the historical figure of 2.5m barrels a day, the refinery is nowhere near operating at full capacity.

By June this year, the refinery had been hoping to operating at full capacity and to facilitate this, the Dangote Group has imported 12m barrels of crude oil from the US. These 12m barrels of crude have already left the US and are expected to land in Nigeria next month, according to The Africa Report.

One industry source said: “About 12m barrels of crude have departed the US and should arrive in Nigeria by February. The Dangote Petroleum Refinery is importing more crude oil as supply from the Nigerian National Petroleum Corporation (NNPC) becomes insufficient for fuel production at the $20bn Lekki-based facility."

Officials at the plant said the facility has ramped up production to about 500,000 barrels per day, with the target of hitting the 650,000bpd mark by June this year. Apparently, the NNPC is  struggling to supply 350,000 barrels per day to the Dangote refinery that are required to meet domestic demand of 450,000 barrels.

One official at the plant said:  “Currently, we are at 500,000 barrels per day and we will ramp this up to 650,000 by mid-year. So, it is a normal process to source crude oil anywhere it is available.”

According to the crude oil production forecast of producing oil companies and the refining requirement of functional refineries in Nigeria, the Dangote refinery would require 550,000 barrels of crude oil daily, 17.05m barrels monthly and 99.55m barrels between January and June this year. It is already building eight more tanks to store imported crude as it plans to stockpile imported crude oil as local supplies become unreliable.

Devakumar Edwin, the vice president in charge of the oil and gas business at Dangote Industries, added: “Importing crude from other countries instead of buying locally means that our crude stockpiles will have to be higher.” The Dangote refinery currently supplies petrol, diesel and aviation fuel to Nigeria and other countries.