Dangote Industries to build new oil refinery in Nigeria to process oil for local and export markets

NIGERIA – Dangote Industries, one of the largest indigenous conglomerates in sub-saharan Africa is in the process of building a refinery with a capacity of 650,000 barrels of oil per day (bpd).

According to Dangote Industries, the refinery, described as the world’s biggest single-train facility, will have the capacity to meet Nigeria’s requirement of all liquid products, such as petrol, diesel, kerosene and aviation fuel, and will have a surplus of each of the products for export

On July 29, Sinopec Corporation announced that the world’s largest atmospheric tower, a piece of equipment that will process crude oil for Dangote refinery, had set sail from China to Nigeria.

The news of the progress made in developing the new factory has however been received with some discomfort among proprietors of small refineries.

However, Mr Ayodele Oni, an energy lawyer and Partner at Bloomfield Law Practice, believes that the Dangote refinery does not constitute a substantial threat to the smaller refineries.

“I think the prospects of the modular refineries are fairly okay,” said Mr. Oni.

“There can be a quota system for all the refineries where every plant has a quota. It depends on what government policy will be at that time.”

The Chairman, Eko Petrochem and Refining Company, Capt. Emmanuel Iheanacho, told The Punch Nigeria that contrary to popular opinion, the Dangote Refinery will complement the output of these smaller refineries in meeting Nigeria’s petroleum product requirements.

Capt. Iheanacho added that the Dangote refinery could only be a “threat to people who are bringing in products to Nigeria.”

Currently, most of the refined petroleum products in Nigeria are imported from other countries.

The government owned refineries built between 1976 and 1989, in Port Harcourt, Warri and Kaduna have an installed capacity of 445 million-bpd but are not fully operational due to worsening conditions of equipment.

The Group Managing Director, NNPC, Mr Mele Kyari, said in August that the corporation was committed to revamping the refineries to enable them to “work to an appreciable level or capacity.”

with a plan to make the country a net exporter of petroleum products by 2023.

The combination of the output of the modular refineries, government-owned refineries and Dangote refinery will serve to supply the nation and help Nigeria achieve its goal of becoming a net exporter of petroleum products by 2023.

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