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    Monday, July 8, 2024

    Dangote Refinery Affirms Commencement of Petrol Production in July

    The Dangote Refinery project was officially inaugurated and commissioned in May 2023.

    Dangote Industries Limited’s Vice President of Oil and Gas, Devakumar Edwin, has confirmed that the Dangote Refinery will begin producing Premium Motor Spirit (PMS), commonly known as petrol, this month.

    During a visit to the Dangote Refinery in Ibeju-Lekki, Lagos, as part of their sovereign credit ratings assessment of Nigeria, officials from S&P Global, a prominent international financial analytics corporation, were informed by Edwin that the company will commence petrol production this month (July), as previously announced.

    In his opinion, this initiative will leverage Africa’s substantial crude oil reserves to produce refined products domestically. Furthermore, the company’s objective is to stimulate a positive cycle of industrial growth, employment generation, and economic prosperity.

    Edwin also mentioned that the products from the $20 billion facility are of superior quality and adhere to international standards. He emphasized that the facility has the capacity to satisfy the entire domestic demand for petrol, diesel, kerosene, and jet fuel, with additional surplus available for export.

    S&P Global expressed Its belief that the 650,000 barrels per day refinery has the potential to alleviate Nigeria’s foreign exchange challenges, reduce pressure on the naira, and contribute to the country’s economic growth.

    Representatives from the Federal Ministry of Finance accompanied the ratings agency’s team during their visit.

    Director and Lead Analyst of Sovereign and International Public Finance Ratings at S&P Global Ratings, Ravi Bhatia, emphasized the transformative impact of the Dangote Refinery on Nigeria’s petroleum industry. During an extensive four-hour tour of the facility, Bhatia expressed his admiration for its impressive scale and capacity to process 650,000 barrels per day, making it the largest single-train refinery complex globally. The rapid construction of the refinery was also highlighted as a remarkable achievement.

    “Nigeria, a substantial exporter of crude oil, faces challenges in importing refined fuels. This presents a market opportunity for domestic crude refining, potentially generating cost savings and preserving foreign exchange reserves. Such a development would have a positive impact on the economy in the medium term. Based on our assessment, the outlook appears favorable.”

    The S&P team expressed their appreciation to the President of Dangote Industries Limited, Aliko Dangote, for his commitment to integrating advanced technologies and implementing rigorous quality control measures, including the establishment of a cutting-edge Central Control Unit that ensures seamless automation of operations.

    Other members of the team of the international ratings agency include the Associate Director, Sovereign Ratings, Maxmillian McGraw; Director, Corporate Ratings, Omegu Collocott; Senior Analyst, Bank Ratings, Charlotte Masvongo, and Director, Financial Services, Samira Mensah.

    The refinery, which currently has a capacity of 350,000 barrels per day, is expected to increase its capacity to at least 500,000 barrels per day by July/August. This expansion will enable the refinery to commence the refining of petrol and ultra-low sulfur diesel.

    The refinery, meticulously engineered to handle a diverse spectrum of crude oils, adheres to the stringent Euro V specifications. Furthermore, it is meticulously designed to comply with the stringent emission norms established by the US EPA, the European Union (EU), the Department of Petroleum Resources (DPR), and the African Refiners and Distribution Association (ARDA).

    It Is noteworthy that while the majority of refineries were constructed by international companies, it is a source of pride that a Nigerian company successfully designed and constructed the world’s largest single-train refinery complex, encompassing the engineering, procurement, and acting as the construction (EPC) contractor.

    The Dangote refinery boasts a self-sufficient marine facility, capable of accommodating the largest vessels in the world.

    “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.

    Nigeria, a prominent global oil producer, exports its crude oil for refining and subsequently imports refined products due to operational refinery constraints. Nigeria imports approximately 50 million liters of petrol daily to satisfy domestic demand.

    As per the Foreign Trade Statistics for the Fourth Quarter of 2023 released by the National Bureau of Statistics (NBS), Nigeria’s petroleum product imports, including petrol, amounted to approximately ₦12 trillion in 2023. This represents an increase of 18.68% compared to the ₦10 trillion spent on fuel imports in the previous year, 2022.

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