Dangote Refinery set for petrol sales start after ending rift with oil suppliers
Dangote Refinery is upbeat its 650,000 barrel-per-day capacity crude processing plant will commence sales to fuel marketers in August.
The development follows the intervention of big industry players and the Nigerian Government in a major dispute with suppliers, helping end a delayed kick-off of distribution of the fuel.
Production began at Africa’s biggest refinery in January, with the refiner processing diesel and aviation for a start in big relief from construction delays that caused the project ten years to be completed, shooting initial costs of $9 billion to $19 billion at delivery.
“Gasoline production to commence in July with sales from August,” Aliko Dangote, Africa’s richest man and the president of the Dangote Group, said on Sunday during a presentation at a media tour of the plant in Lagos.
“Annual revenue is projected to exceed $26 billion,” the document further stated.
Mr Dangote told journalists the conflict with international oil companies in respect of the supply of feedstock has been laid to rest following the mediation of state oil company NNPC Limited and the Nigerian Government.
Last week, the Nigerian Upstream Regulatory Commission (NUPRC), which regulates the segment of the industry that focuses on exploration and production, announced it had entered an agreement with producers to ease supply to local refineries.
“We will never allow price strangulation to disincentivise our domestic refining capacity optimisation,” NUPRC’s CEO Gbenga Komolafe said after meeting with the members of the Oil Producers Trade Section, a group of domestic and international producers.
Mr Komolafe assured that his agency would discourage “crude supply profiteering.”
His remark followed an allegation by Dangote Group that international oil companies are standing in the way of the smooth running of the plant by offering crude oil to the refiner at a cost above the market price.
“The IOCs are deliberately and willfully frustrating our efforts to buy the local crude. They are either asking for ridiculous/humongous premium(s), or they simply state that crude is unavailable,” Devakumar Edwin, vice president oil & gas at Dangote Industries, said in June.
The refinery has had to rely on crude from the US in recent times to keep running and is set for a receipt of oil shipment from Brazil soon.
Currently running at a capacity per day, the refinery is expected to wean Nigeria off reliance on imported fuel, which consumes a big portion of its scarce foreign exchange, and also supply petroleum products to other parts of West Africa.
Premium Times