Nigeria’s state oil company, NNPC Ltd, is set to provide the new Dangote oil refinery, capable of processing 650,000 barrels per day, with up to six cargoes of crude oil in December for test runs, according to sources familiar with the matter.
The refinery, financed by Africa’s wealthiest individual, Aliko Dangote, has the potential to reshape oil trading in the Atlantic Basin, potentially reducing demand for fuels produced in Europe and the United States, which have traditionally fueled vehicles and generators across the African continent.
Located in the Lekki free trade zone near Lagos, the Dangote oil refinery, once fully operational, will transform Nigeria from being a net importer to a net exporter of fuels. This shift aligns with Nigeria’s long-standing goal to reduce its dependence on fuel imports.
An NNPC official revealed that six cargoes, equivalent to 200,000 barrels per day, would be supplied in December as part of a one-year agreement. Future monthly volumes will be determined based on mutual agreement and availability.
Other sources suggested that around 4-5 cargoes, or at least 130,000 barrels per day, are planned. A Dangote Group official noted that “some of the agreements have confidentiality clauses” when asked about the NNPC supply deal.
NNPC holds a 20% stake in the Dangote oil refinery, which commenced its commissioning process in May after experiencing significant delays and cost overruns, with the final price tag reaching $19 billion, exceeding initial estimates of $12-14 billion. The commissioning process includes testing various units responsible for producing gasoline, diesel, and other products to ensure they operate as intended.
