Dangote Refinery, Africa’s largest oil refinery, is making significant strides in the oil and gas industry by securing deals with several African countries to export fuel. The refinery’s management is currently in advanced negotiations with South Africa, Angola, Niger Republic, Chad, Burkina Faso, Central Africa Republic, and Namibia to start lifting fuel.
In addition to exporting Premium Motor Spirit (PMS), the refinery has already begun exporting diesel fuel to various African countries, with a notable increase in May, reaching nearly 100,000 barrels per day. Furthermore, aviation fuel exports from the refinery have also seen a rise in demand.
During the commencement of petrol production in September, Aliko Dangote, the chairman of the Dangote Group, expressed confidence in the refinery’s ability to cater to the local and regional markets with petrol, diesel, and other products like polypropylene. He emphasized that the refinery will revolutionize Nigeria and Africa’s oil and gas industry dynamics, meeting the demands of the Sub-Saharan African region.
Last month, Ghana announced its intention to purchase fuel from the Dangote refinery, a move that could potentially save the country approximately $400 million in monthly fuel imports from Europe. Mustapha Abdul-Hamid, chairman of Ghana’s National Petroleum Authority, revealed this development at the OTL Africa Downstream Oil Conference in Lagos.
However, despite the refinery’s promising prospects, there have been challenges with Nigerian petroleum marketers over pricing disputes. Marketers have accused the refinery of setting high petrol prices, leading them to prefer importing petrol rather than buying from Dangote Refinery.
As Dangote Refinery ramps up production and negotiates competitive pricing, Nigerian marketers may reconsider their stance and shift towards local procurement if the refinery can offer favorable terms, reliable supply, and efficient distribution. This shift could potentially lead to a more sustainable and mutually beneficial relationship between the refinery and local marketers in Nigeria.
