Dangote Refinery Boosts Storage Capacity to 5.3 Billion Litres
Aliko Dangote announces plans to expand Dangote Refinery's storage capacity to 5.3 billion litres, strengthening its position in the market and enhancing energy security. Despite facing obstacles from international oil companies, Dangote remains committed to revolutionizing the oil industry and producing high-quality fuel domestically.
Aliko Dangote, President of the Dangote Group, has unveiled plans to significantly expand the storage capacity of his refinery by 600 million litres, bringing the total capacity to 5.3 billion litres. This strategic move aims to enhance the refinery's capabilities and strengthen its position in the market.
The Dangote Petrochemical Refinery currently boasts a substantial storage capacity of 4.78 billion litres for refined petroleum products. The planned expansion will further bolster the refinery's infrastructure, enabling it to meet the growing demand for petroleum products and cement its status as a leading player in the industry.
Aliko Dangote made this announcement during his keynote speech at the prestigious Afreximbank Annual Meetings and AfriCaribbean Trade & Investment Forum, held in Nassau, The Bahamas, on Wednesday, June 12. This event brought together esteemed leaders and stakeholders from across the continent, providing a platform for strategic discussions and knowledge sharing.
Aliko Dangote, the business mogul, made a startling revelation that international oil companies refused to sell crude oil to his refinery, seemingly motivated by a desire to hinder his success. This unexpected obstacle has not deterred Dangote from his mission to revolutionize the oil industry.
When queried about the potential impact of his refinery on the pump price of petrol, currently hovering around N700 per litre, Dangote tactfully sidestepped a direct answer. However, he astutely pointed out the significant price drop in diesel from N1,700 to N1,200, which occurred when his diesel product entered the market, hinting at the potential for similar price reductions in the future.
“The issue of gasoline is certainly a different issue. That one is being dealt with by the government. But let me give you an example. In the diesel, which the industries, transporters and everybody consume; when we first started, it was N1,700, and the dollar conversion was about N1,200 then. Immediately when we started, within two weeks we brought down the price to N1,000. We took it from N1,700 to N1,200 and from N1,200 to N1,700, we have given more than 60 per cent drop in price.
“With the currency now back up to about N1,500 per dollar, the price is still below N1,200. That's a big improvement, from N1,700 to N1,200. And the diesel is available, we are not living from hand to mouth anymore,” Dangote replied when asked about a possible petrol price.
Aliko Dangote revealed that his refinery will serve as a strategic reserve for refined petroleum products, providing a buffer against supply disruptions and ensuring a stable supply of essential fuels to the market.
“The country doesn't have strategic reserves in terms of petrol, which is very dangerous. But in our plant now, when you came, we had only 4.78 billion litres of various tankage capacity. But right now we're adding another 600 million.
“So effectively, as we go forward, the refinery will be the strategic reserve of the country in terms of petroleum products,” he noted.
Aliko Dangote, Africa's wealthiest individual, disclosed that international oil companies denied him access to their crude oil, skeptical of his ambitious plans to operate a 650,000 barrels per day capacity refinery, doubting his ability to successfully execute such a large-scale project.
“In a system where, for 35 years, people are used to counting good money, and all of a sudden, they see that the days of counting that money have come to an end, you don't expect them to pray for you. Of course, you expect them to fight back.
“And I think that is the process that we're now really going through. But the truth is that, yes, the country, the sub-region, and also the continent, of sub-Saharan Africa, need this refinery. So, you expect them to fight through non-supply of crude, non- purchase of the product, but I think it's all temporary. We'll get there,” he added.
Aliko Dangote, the Nigerian business magnate, has been sourcing crude oil from the United States to supply his refinery, utilizing it as feedstock to produce high-quality fuel. This strategic move marks a significant shift away from Nigeria's traditional reliance on imported refined petroleum products.
Dangote, who hails from Kano, pointed out the long-standing practice of importing substandard fuel into Nigeria, emphasizing the need for a more sustainable and self-sufficient approach to meeting the country's energy demands. His refinery aims to address this issue by producing high-quality fuel domestically, reducing reliance on imports and enhancing energy security.
Aliko Dangote appealed to the Federal Government to strictly enforce regulations banning the importation of substandard fuels, which have been linked to a surge in cancer cases in Nigeria and across Africa. He stressed the urgent need for action, highlighting the devastating health impacts of these inferior fuels and the imperative to protect citizens' health and well-being.
Regarding imported fuel, Dangote declared, “It is high sulfur, very polluting and also when you look at it, especially in Nigeria, in the past few years, we've been having cases of cancer, and most of these cases of cancer have to do with the bad fuel that we've been using. So, I will advise even here, you should check the quality of what is being dumped in your region in The Caribbean.”
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