Dangote Refinery Set to Provide Daily Supply of 25m Liters of Petrol

Olufemi Adeyemi 

Dangote Refinery commenced petrol production from its facility yesterday, allowing Nigerians to purchase the product starting tomorrow. 

In a significant step towards meeting the country's energy demands, Alhaji Aliko Dangote, President of Dangote Refinery, showcased a unique sample of the inaugural petrol produced at the refinery.

He was joined by Devakumar Edwin, Vice President of Oil and Gas at Dangote Industries Limited (DIL), and Hajiya Fatima Aliko-Dangote, Group Commercial Operations Director at DIL.

Dangote characterized this rollout as a pivotal moment for the nation, presenting numerous opportunities to tackle ongoing economic challenges.

He also highlighted the economic advantages that will arise from the refinery's full operation, which was inaugurated by former President Muhammadu Buhari in May of the previous year.

The refinery had not released any products until April 2, when it began producing diesel and Jet A1.

Yesterday's event marks another significant milestone in the history of the 650,000 barrels per day facility.

Alongside Devakumar Edwin and Hajiya Fatima Aliko-Dangote, Dangote expressed his appreciation to Nigerians for their support and commended President Bola Tinubu for creating a conducive environment that enabled the successful launch of the refinery.

He remarked that today marks a significant milestone, as Nigeria has not been able to produce petrol or gasoline for several years. While addressing the audience, he expressed his appreciation to the Nigerian populace and President Bola Ahmed Tinubu’s administration for fostering the conditions that have made this remarkable achievement possible. This advancement is set to fuel the nation’s growth, development, and prosperity.

He also conveyed his personal gratitude to the President for the introduction of the ‘naira for crude’ and ‘naira for products’ initiatives. These measures are expected to provide essential stability to the naira by decreasing the market's demand for dollars by 40 percent, thereby aiding in the stabilization of the exchange rate.

Furthermore, he highlighted that this initiative will tackle issues such as ‘round-tripping,’ where fuel is recorded but fails to enter Nigeria. With the establishment of this new refinery, there will be enhanced visibility into actual consumption.

"We will be able to monitor every loaded truck and, to the best of our ability, oversee loaded ships. This will enable us to accurately assess consumption trends, although that is a subject for another time.

"Today, we gather to celebrate and express our gratitude to God Almighty for leading us to this juncture where we can produce gasoline. Many were skeptical about our ability to reach this point, but we have succeeded."

He indicated that Dangote petrol may be somewhat cleaner than previous options available in the country, as it is of the highest quality, which will contribute to the longevity of vehicle engines. 

"The quality of this fuel can compete with any premium standard globally, including those found in Europe and America. 

No one can exceed us in terms of quality. Today is indeed a celebration for us Nigerians," Dangote remarked. He also mentioned that by next month, Nigeria will no longer need to import polypropylene, as the group's petrochemical plant will be fully equipped to satisfy all local requirements. 

While assuring that the refinery will ensure the local availability of petrol, Dangote clarified that the Nigerian National Petroleum Corporation Limited (NNPCL) is in charge of regulating petrol pump prices. "Pricing is managed by NNPC. For now, our focus is on guaranteeing product availability—that's my assurance," Dangote stated. 

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) announced that it has finalized an agreement with NNPCL to sell crude oil to the Dangote refinery in naira. NMDPRA shared this information in a statement via its X (Twitter) account yesterday during a meeting at its headquarters in Abuja. 

The authority further confirmed that the refinery is set to supply an initial 25 million liters of PMS to the domestic market, with plans to increase that amount to 30 million liters daily starting in October. 

"At the NMDPRA headquarters in Abuja, NNPCL has reached an agreement to initiate crude oil sales and supply to Dangote Refinery in local currency," NMDPRA stated.

This recent development arises as Nigerians face a significant nationwide petrol shortage, which has intensified over the past two weeks. 

Femi Otedola, Chairman of Geregu Power, commended Dangote for officially starting petrol production at the Dangote Refinery, emphasizing that this initiative will resolve ongoing issues within the oil sector. 

He encouraged depot owners across the country, including members of the Major Energy Marketers Association of Nigeria (MEMAN), the Depot and Petroleum Products Marketers Association of Nigeria, and other independent petroleum marketers, to brace for a major transformation in the industry. 

Otedola suggested that they consider dismantling their petroleum depots and selling the materials as scrap while market conditions remain favorable. An analyst noted that the unique near-clear appearance of Dangote petrol is due to the use of ethanol as a refining additive. 

The analyst explained, “Petrol can exhibit various colors based on the additives used during the refining process. A red hue indicates the presence of Octane, while a slight green suggests a higher Octane content. Yellow signifies that the petrol is unleaded. 

However, when it appears clear like water, as shown in the video, it indicates the use of ethanol, which enhances engine efficiency and power.”

Ethanol's high oxygen content contributes to a reduction in engine carbonation, which in turn diminishes carbon dioxide emissions and air pollution. Therefore, it is considered an optimal fuel choice. 

Ogun State Governor, Prince Dapo Abiodun, stated that the initiation of petrol production at the Dangote Refinery will bolster the nation's economy by addressing persistent shortages and preserving foreign exchange reserves. 

In a statement released yesterday, Abiodun emphasized that the refinery's operations will resolve a significant issue that Nigeria has faced for over thirty years—its dependence on fuel imports. He noted that with the Warri and Port Harcourt Refineries also set to commence production, Nigerians can expect relief from ongoing fuel shortages, while the economy will benefit as well. 

He remarked, “This remarkable achievement signifies a transformative milestone not only for you as an entrepreneur but also for Nigeria and the wider African continent. 

The establishment of this refinery marks a crucial turning point in the region's energy sector, highlighting the importance of vision, resilience, and a steadfast commitment to economic growth. The Dangote refinery is set to revolutionize petrol production, tackling one of Nigeria's most urgent challenges: its reliance on imported fuel. 

This dependency has not only put pressure on our foreign exchange reserves but has also limited our potential for self-sufficiency. By producing petrol domestically, the refinery will significantly curtail the outflow of foreign currency, thereby fortifying our economy. 

This initiative aligns seamlessly with the efforts of President Bola Tinubu's administration to promote economic diversification and lessen dependence on oil exports alone.

In addition, the refinery's economic influence reaches far beyond fuel production. It is anticipated to create thousands of jobs, both directly and indirectly, thereby aiding in the decrease of unemployment rates. This job creation will have a cascading effect on local economies, fostering growth in related industries and improving the quality of life for numerous families throughout Nigeria.

The refinery's operations are anticipated to not only strengthen local employment and stimulate economic activity but also improve energy security in Nigeria. By producing a significant amount of petrol, the nation will be more capable of fulfilling its energy requirements, thereby minimizing the unpredictability linked to fuel shortages and price variations. This enhanced stability is likely to foster a more conducive atmosphere for businesses and draw in foreign investments, ultimately promoting economic growth.