Dangote refinery says crude oil supply issue being resolved

Dangote's $20bn Petroleum Refinery was built to use Nigerian crude and add value to it within the country.

President and Chief Executive Officer of Dangote Group, Alhaji Aliko Dangote, who stated this in a statement issued by the refinery on Thursday, said the domestic crude oil supply issues in Nigeria were being resolved by the parties involved.

The statement said the refinery has already affected crude flows, with dozens of Nigerian cargoes remaining in-country and US WTI Midland, a comparable light, sweet grade, being imported. It said the mega-refinery could therefore tighten the light, sweet crude market.

It stated that crude flows in and out of the refinery have been felt in other markets, especially in Europe, the largest consumer of light, sweet Nigerian crude.

The multi-billion dollar company further said that the US grade crude oil has accounted for 30 per cent of crude delivered to Dangote, through 18 cargoes, adding that the facility would broaden the refinery’s feedstock sources with Libyan, Angolan, and Brazilian crude.

Nigeria is sub-Saharan Africa’s largest oil producer, pumping 1.5 million barrels per day in June, according to the Platts OPEC Survey from S&P Global Commodity Insights.

Until this year, all of its oil was exported due to the lack of refining capacity, with gasoline, diesel, and jet fuel imported for domestic use.

The statement also noted that the Organisation of Petroleum Exporting Countries said supplies from Dangote Refinery and Petrochemicals would put pressure on the performance of Europe’s oil industry, especially the Northwest Europe gasoil.