By DAYO ADESULU
Strategic Move to Enhance Refinery Operations and Meet Production Goals
The Dangote Petroleum Refinery is set to receive a substantial shipment of 12 million barrels of crude oil from the United States, a strategic decision aimed at overcoming local supply challenges that have hindered its operations. As the $20 billion refinery in Lekki, Nigeria, gears up to reach its full refining capacity, the importation of crude has become a necessity.
Overcoming Local Supply Limitations
The refinery’s ambition to achieve a refining capacity of 650,000 barrels per day (bpd) by June is currently under threat due to insufficient local crude supply from the Nigerian National Petroleum Company Limited (NNPC). Reports indicate that the NNPC is struggling to deliver the required 350,000 bpd to the refinery, which has ramped up its production to approximately 500,000 bpd.
Shipment Details and Future Plans
According to sources from African Report, the crude oil shipment has already departed the United States and is expected to arrive in Nigeria by next month. This move underscores the refinery’s commitment to maintaining a stable feedstock, essential for fuel production. Furthermore, Dangote Petroleum Refinery is expanding its storage capabilities by constructing eight additional tanks to accommodate the imported crude, increasing total storage capacity by 41.67% to 3.4 billion liters.
Strategic Imports to Ensure Consistent Production
Devakumar Edwin, Vice President of Oil and Gas at Dangote Industries, emphasized that reliance on imported crude has become necessary due to the inconsistent supply from the NNPC. He noted, “Importing crude from other countries instead of buying locally means that our crude stockpiles will have to be higher.” This reflects a shift in strategy as the refinery seeks to ensure a reliable supply chain for its production needs.
Future Outlook and Production Requirements
Looking ahead, the Dangote refinery anticipates requiring 550,000 barrels of a blend of Nigerian crude oil daily, translating to 17.05 million barrels monthly. By 2025, projections indicate a need for approximately 99.55 million barrels to sustain operations. In light of these forecasts and the recent challenges faced, the decision to import crude has been deemed essential.
Conclusion
The procurement of 12 million barrels of US crude oil marks a significant step for the Dangote Petroleum Refinery as it navigates local supply challenges. With plans to enhance storage capabilities and a clear focus on meeting production targets, the refinery is poised to bolster Nigeria’s fuel production landscape.
