The Dangote Refinery in Lagos is in discussions with Libya to import crude oil for its 650,000 barrels per day plant as it increases production.
The Vice President of Dangote Industry Limited (DIL), Devakumar Edwin, shared this information with American-based media, Reuters, on Sunday.
The Vice President also added that the refinery will seek crude from Angola as the Nigerian National Petroleum Corporation (NNPC) Limited has been unable to meet the demand of the 650,000bpd refinery.
Since beginning operations in January, Dangote has faced difficulties securing adequate crude supplies in Nigeria.
Despite being Africa’s largest oil producer, the country struggles with theft, pipeline vandalism, and low investment.
As a result, Dangote has resorted to importing crude from as far as Brazil and the United States.
“We are talking to Libya about importing crude.
“We will talk to Angola as well and some other countries in Africa,” Edwin said in a statement.
He mentioned that international traders and oil companies were among the largest buyers of Dangote’s gasoil, much of which was being exported.
Edwin noted that Dangote’s oil trading arm was operational, with staff in London and Lagos, to manage supplies and sell products.
“The biggest off-takers are the two big traders Trafigura and Vitol and BP and, to some extent, even TotalEnergies. But all of them are saying they are taking it to offshore,” Edwin said.
Controversy with Nigeria oil authorities
In recent days, the refinery has been enmeshed in dispute with the oil regulatory bodies in Nigeria, particularly the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
The head of NMDPRA, Farouk Ahmed, accused the refinery, alongside other local refineries of having high sulfur contents, as high as 650 parts per million (ppm).
Ahmed also claimed that the CEO of the refinery, Aliko Dangote, might be attempting to monopolize the industry, a move he believed was not safe for the energy security of the country.
In response, Dangote challenged the regulatory authorities to visit his plant in Lagos and examine the content of their products, adding that they have the best quality products in Nigeria.
Accordingly, the businessman also halted his plans to invest in Nigeria’s steel industry to avoid accusations of being a monopoly.
It’s important to note that the steel industry, which has been moribund for decades, remains underdeveloped and underinvestment.
Dangote said other wealthy Nigerians can venture into the steel business, emphasizing that the board of his multi-sectorial firm has advised him to stay off the industry.
What you should know
The Dangote Refinery, located in the Lekki Free Zone near Lagos, Nigeria, is one of the largest oil refineries in the world. Initiated by the Dangote Group, it aims to meet Nigeria’s domestic demand for refined petroleum products, reducing the country’s dependence on imported fuel.
The refinery’s projected capacity is 650,000 barrels per day, which is expected to transform Nigeria from an importer to a net exporter of refined petroleum products.
Construction of the refinery began in 2016, with the project involving complex engineering and massive investments. The refinery includes a petrochemical plant and a fertilizer plant, making it a significant industrial hub in the region.
The impact of the Dangote Refinery extends beyond the oil sector. It is anticipated to create thousands of jobs and stimulate economic growth in Nigeria. By producing a surplus of refined products, it aims to stabilize fuel prices and ensure a steady supply for local markets, contributing to energy security. (Nairametrics)
