The Dangote Refinery is ready to process about 400,000 barrels of crude daily over the next two months and will reach full capacity in the coming months.
Bloomberg reports that a cargo allocation list shows the plant is set to get about 24 million barrels of crude in October and November, showing a shift towards using more domestic supplies.
Analysts believe the increased demand from the 650,000 bdp-capacity refinery could significantly tighten the West African crude oil market in the last quarter of 2024.
Ronan Hodgson, an analyst at FGE, disclosed that the substantial intake by the $20 billion refinery could push Nigeria’s crude exports below one million barrels daily due to its high oil demand.
The report also said that some shipments may face delays, with two cargoes in October’s schedule initially postponed from September.
Despite the delays, the volume slated for the coming months is higher than the refinery’s average intake of 255,000 barrels daily in the first half as it gradually builds up its operations.
Chairman of Engineers India Limited, Vartika Shukla, said the massive plant is currently operating at 60-70 capacity and is expected to reach full capacity within months.
The new allocations also show a reduction in the company’s purchases of US crude.
TimesNow.com.ng earlier reported that the refinery imported millions of barrels of crude oil from the US but later re-sold them and stopped further purchases.
The Nigerian government announced that it has begun selling crude oil to local refineries, including the Dangote refinery in naira.
Following the Nigerian government’s directive, the Ministry of Finance disclosed that the naira-for-crude sale commenced on October 1, 2024.
However, officials at the Dangote Refinery disclosed that the consignment has yet to arrive but expressed optimism over the deal’s commencement.
Another report disclosed that in the last 10 months, the Nigerian National Petroleum Company Limited (NNPC) delivered about 48.6 million barrels of crude oil to the Dangote Petroleum Refinery.
Data from official transactions between the two companies showed that 3.4 million barrels were supplied in December 2023 and 3.5 million in February 2024.
Details of the transactions further show that 3.3 million barrels, 3.3 million, three million, 5.1 million, 4.8 million, and 5.6 million barrels of crude were supplied to the refinery in March, April, May, June, July, August, and September 2024, respectively.
BusinessDay reports that the NNPC agreed to supply crude to the mega refinery for exclusive rights to distribute its products.
TimesNow.com.ng previously reported that the NNPC had reportedly ended its exclusive agreement to buy petrol from Dangote Refinery.
The decision allows independent marketers to buy directly from the Dangote refinery and negotiate prices.
Premium Times reports that NNPC’s limited decision aligns with the current practices for fully deregulated products, where refineries can sell directly to marketers on a willing buyer, willing seller basis.
