Dangote Refinery Set To Commence Operations As First Crude Shipment Arrives

After a series of delays, the Dangote Refinery, a mammoth $19 billion project in Nigeria, is finally poised to commence fuel production as the first crude shipment arrives at the facility, marking a significant milestone for the country’s oil industry.

Quoting industry sources and tanker tracking data, S&P Global, in a report on its website, spglobal.com, said that the OTIS tanker, carrying a 950,000 barrel cargo of Nigeria’s Agbami crude, set sail on December 6 and is currently en route to Lekki, the nearest land port to Dangote’s offshore crude receiving terminal.

The tanker is expected to arrive on December 7 around 8pm, this shipment marks the initiation of crude supplies for the refinery’s operations.

The Suezmax tanker, chartered by the state-owned Nigerian National Petroleum Company (NNPC), symbolises the initial crude supply to Dangote’s state-of-the-art refinery as it gears up to initiate production, revealed a West African oil trader familiar with the matter, the S&P report said.

Despite the refinery’s official completion in May, the lack of domestic crude feedstock had impeded oil product manufacturing. The NNPC, owning a 20% stake in the refinery, recently entered an agreement to supply 6 million barrels of crude oil as feedstock to the Dangote refinery in December, aiming to jumpstart operations.

RELATED

Request For New Parties Registration Hit 144 — INEC

6 hours ago

Yahoo Mail Suffers Global Outage As Users Hit By ‘Temporary Error 15’

7 hours ago

Agbami, operated by Chevron, stands as one of Nigeria’s major deepwater developments, boasting a daily output of approximately 100,000 b/d in the central Niger Delta. Renowned for its light sweet crude qualities with specific gravity measuring 47.9 API and sulphur content of 0.04%, Agbami yields significant proportions of naphtha and kerosene.

Further shipments from various Nigerian offshore fields to the refinery have been chartered by NNPC, signifying the beginning of a series of scheduled crude supplies throughout this month, according to the oil trader.

The Dangote Refinery, situated on the outskirts of Lagos, Nigeria’s commercial hub, had faced recurrent delays since its announcement in 2013, despite substantial installation progress made in 2019.

Designed to process multiple crudes concurrently, the refinery aims to process three Nigerian crude grades — Escravos, Bonny Light, and Forcados. Upon reaching full operational capacity, the facility is anticipated to produce a daily output of 327,000 b/d of gasoline, 244,000 b/d of gasoil/diesel, 56,000 b/d of jet fuel/kerosene, and 290,000 mt/year of propane/LPG.

The commencement of Dangote’s operations raises hope for Nigeria’s aspiration to reduce its reliance on gasoline imports, addressing the inadequacy of its existing refineries currently undergoing repairs. This anticipated shift is expected to transform Nigeria’s oil industry landscape, potentially leading to self-sufficiency in gasoline production by the 2040s.

While Dangote officials foresee an initial output of 370,000 b/d, primarily focusing on jet fuel and diesel production, industry analysts expect the refinery to achieve its full operational capacity around mid-2025, albeit with potential delays still looming.