Dangote Refinery: Fuel Production to Start in July
Dangote Refinery set to start petrol production in July, boosting Nigeria's energy independence.
Dangote Industries Limited (DIL) Vice President of Oil and Gas Devakumar Edwin has stated that Premium Motor Spirit (PMS) will be produced at the 650,000 bpd Dangote Refinery starting in July 2024.
This was revealed by Edwin when he oversaw a group from S&P Global, an international financial analytics company, during an on-site tour of the Dangote Refinery in Ibeju-Lekki, Lagos.
According to Edwin, the company wants to spark a positive cycle of industrial development, job creation, and economic prosperity by using Africa's plentiful crude oil resources to make refined products domestically.
The Vice President of Oil and Gas stated that the refinery, which is currently running at 350,000 barrels per day capacity, is scheduled to scale up to at least 500,000 barrels per day capacity by July/August, starting the refining of gasoline and ultra-low sulfur diesel. However, the Vice President also reassured that the company is on track to meet the July promise for petroleum production.
He said the $20 billion plant can supply all of Nigeria's needs for aviation fuel, kerosene, diesel, and gasoline while also meeting international requirements for high-quality products with surpluses that can be exported.
He mentioned that the refinery complies with Euro V requirements and is built to process a variety of crudes, including light oil from the United States and various African and Middle Eastern countries. Furthermore, it is engineered to meet the emission criteria set forth by the US EPA, the European Union (EU), the Department of Petroleum Resources (DPR), the African Refiners and Distribution Association (ARDA), and other regulatory bodies.
“The refinery can produce the best quality products in the world, Euro V grade. It is one of the energy-efficient refineries and it is highly environmentally friendly. It is sophisticated with a high level of automation. The largest single train refinery in the world is 100 per cent designed, engineered, and constructed by a Nigerian company as EPC contractor,” he said.
Although he acknowledged that foreign firms constructed the majority of refineries, he expressed satisfaction in the fact that a Nigerian company planned and constructed the largest single-train refinery complex in the world, serving as its own direct Engineering, Procurement, and Construction (EPC) contractor. In addition, the refinery has an independent maritime facility that can handle the biggest ships in the world.
Concurrently, the delegation headed by Ravi Bhatia, Director and Lead Analyst, Sovereign and International Public Finance Ratings, S&P Global Ratings, stated that the Dangote refinery will turn Nigeria into a net exporter of petroleum products. He continued by saying that this shift is anticipated to increase revenue production and lessen the strain currently placed on the nation's foreign exchange reserves.
As to the team's assessment, Dangote Oil Refinery and Petrochemicals company possesses the ability to address Nigeria's foreign exchange (forex) predicament and alleviate the significant strain on the Naira currency, all while promoting the nation's economic progress.
“It is a very impressive facility, able to process 650,000 barrels a day, when in full capacity. It is the largest single-train refinery complex in the world. It came out quite quickly. Nigeria is a big exporter of crude but has issues with importing refined fuels. So, there is a gap in the market where crude can be refined in Nigeria, save money that way, and potentially save some foreign exchange. This will be positive for the economy in the medium term. It looks positive from our assessment,” Bhatia said after a tour of the facility.
The Dangote Industries Limited president, Aliko Dangote, received praise from the S&P team for incorporating cutting-edge technology and quality control procedures, such as a cutting-edge central control unit that guarantees efficient automation of processes.
The associate director of sovereign ratings, maxmillian McGraw; director of corporate ratings, Omegu Collocott; senior analyst of bank ratings, Charlotte Masvongo; and director of financial services, Samira Mensah, are among the other members of the international rating agency team who are escorted by representatives from the Federal Ministry of Finance.
Nigeria, one of the top oil-producing nations in the world, imports refined products since it lacks operable refineries and exports all of its crude oil for processing. To meet domestic demand, Nigeria is thought to import at least 50 million liters of fuel daily.
The National Bureau of Statistics (NBS) reported in its Foreign Trade Statistics for the Fourth Quarter of 2023 that Nigeria imported petroleum goods worth about N12 trillion in 2023, including premium motor spirit (PMS), or gasoline. When compared to the N10 trillion spent on petroleum imports in 2022, this amount represents a growth of 18.68%.
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