Tag: Dangote Refinery

President and Chief Executive of Dangote Industries Limited, Aliko Dangote, has announced an ambitious expansion of the Dangote Refinery’s production capacity from 650,000 barrels per day (bpd) to 1.4 million bpd, making it the largest refinery in the world upon completion.

Speaking at a press conference in Lagos on Sunday, alongside billionaire entrepreneur Femi Otedola, Dangote said the expansion project, scheduled to take three years, will surpass India’s Jamnagar Refinery, which currently holds a capacity of 1.24 million bpd.

“This expansion reflects our confidence in Nigeria’s future, our belief in Africa’s potential, and our commitment to building energy independence for our continent,” he said.

Dangote disclosed that the construction phase will engage about 65,000 workers, while power generation at the plant will be doubled from 500 megawatts to 1,000 megawatts. He also revealed that the refinery will be listed on the Nigerian Stock Exchange by 2026 to enable public ownership.

“We want all Nigerians to own part of this refinery. It’s time to invest and join us in this journey,” he said.

The expansion will also boost polypropylene output from 900,000 metric tonnes to 2.4 million metric tonnes annually, while transitioning production to Euro VI fuel standards — the world’s highest environmental benchmark.

Over 85% of the refinery’s workforce will be Nigerians, Dangote noted, adding that the company remains committed to sustainability, safety, and local participation.

On crude supply concerns, he dismissed fears of shortages, saying arrangements were in place to ensure stability. “We have worked out our numbers. Crude supply will not be an issue,” he said.

Dangote also challenged the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) to acquire or build refineries instead of relying on importation, saying competition would strengthen the local energy market.

He commended President Bola Tinubu for policies supporting industrialisation and praised government intervention in resolving past disruptions at the refinery.

Stakeholders, including the Independent Petroleum Marketers Association of Nigeria (IPMAN), welcomed the expansion, describing it as a major step toward ensuring fuel availability and ending import dependence. Experts, however, urged strong regulation to prevent monopoly and ensure fair market competition.

The Federal Government has announced that Dangote Group will redeploy workers previously disengaged from its refinery operations following the resolution of its dispute with the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN). The government confirmed that the redeployed staff would not face any loss of pay.

Minister of Labour and Employment, Dr. Mohammed Maigari Dingyadi, stated in Abuja on Wednesday that the agreement was reached after reviewing the procedures used in the earlier disengagement. “The management of Dangote Group shall immediately begin redeploying the affected staff to other companies within the group, with no loss of pay. No worker will be victimized arising from their role in the impasse,” he said.

Dingyadi further confirmed that PENGASSAN had agreed to call off the strike, and both parties reached the understanding in good faith. He emphasized that unionization is a fundamental right of workers under Nigerian law and must be respected.

The dispute originated when PENGASSAN raised concerns over alleged mass transfers and dismissals of union members, as well as the replacement of some Nigerian staff with foreign workers. Dangote Group, however, denied the allegations, saying workforce reorganization was purely operational.

The standoff escalated when the union halted gas and crude oil supplies to the refinery, raising concerns over energy supply and economic stability. The Federal Government intervened, citing potential adverse effects on the nation’s economy and energy security, and convened high-level talks to resolve the conflict.

• IPMAN: Direct sourcing from Dangote driving down fuel prices nationwide.
• Disputed 28-million-litre supply agreement sparks mixed reactions.

The Dangote Petroleum Refinery has announced a reduction in the price of Premium Motor Spirit (PMS) from N990 per litre to N970 per litre, signaling a potential shift in Nigeria’s downstream oil market. This price, applicable to marketers, reflects efforts to bolster domestic supply and foster competition.

In a statement on Sunday, Anthony Chiejina, Group Chief Branding and Communications Officer of Dangote Group, described the move as a gesture of appreciation to Nigerians for their support and encouragement.

“As the year comes to an end, this is our way of appreciating the good people of Nigeria for their unwavering support in making the refinery a reality. We also thank the government for their cooperation, which has helped encourage domestic enterprise for collective prosperity,” Chiejina said.

He assured Nigerians that the refinery remains committed to delivering top-quality, environmentally sustainable petroleum products while ramping up production to meet domestic demand.

Competition Drives Price Reduction

The Independent Petroleum Marketers Association of Nigeria (IPMAN) attributed the downward trend in petrol prices to increased competition, facilitated by the deregulation of the downstream sector and direct transactions with the Dangote Refinery.

IPMAN spokesman Chinedu Ukadike noted, “Our direct dealings with Dangote are already pushing prices down. Before the end of the year, Nigerians should expect further reductions as market competition intensifies.”

Recent reports confirm that independent and major marketers have adjusted pump prices, with some stations reducing prices by N10 to N15.

A major oil marketer, speaking anonymously, explained that the competition has quietly reduced pump prices. “People aren’t noticing the drop because there’s no fanfare. Deregulation is working, and competition is driving this positive trend,” the source said.

Controversial 28 Million Litres Agreement

A purported resolution involving Dangote Refinery, the Nigerian National Petroleum Company Limited (NNPC), and other stakeholders allegedly mandates the supply of 28 million litres of PMS daily for six months to the Nigerian market. This agreement, reportedly brokered during a November 13 meeting, aims to stabilize fuel supply and reduce reliance on imports.

However, the NNPC and Dangote Group have denied knowledge of such an agreement.

NNPC Chief Communications Officer, Olufemi Soneye, dismissed the claims as “untrue,” while Dangote Group’s Anthony Chiejina labeled the reports as speculative.

Despite the denials, the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) insists the deal is genuine, asserting that the agreement would bolster market stability and price regulation.

Looking Ahead

While disputes persist over the specifics of the agreement, analysts believe the price reduction and increased supply from Dangote Refinery signal a turning point for Nigeria’s energy sector. The development highlights the impact of deregulation and the role of domestic refineries in shaping the market.

With competition heating up and stakeholders aligning, Nigerians can look forward to improved fuel availability and potentially lower prices as the year progresses.

…First Shipment Heads to Togo; Talks Underway with Ghana, South Africa, and More

The Dangote Petroleum Refinery has initiated the export of refined petroleum products to neighboring West African countries, signaling a potential shift in regional fuel markets.

According to a report by Bloomberg on Tuesday, citing data from Vortexa, Kpler, Precise Intelligence, and ship-tracking platforms, a tanker carrying over 300,000 barrels of gasoline departed the refinery, destined for waters off Togo’s coast. The vessel, CL Jane Austen, marks the beginning of what could become a steady export operation.

Ghana has expressed keen interest in sourcing petroleum products from the refinery. Last month, the chairman of Ghana’s National Petroleum Authority (NPA), Mustapha Abdul-Hamid, said importing from Dangote could help the country save on costly European imports, which amount to about $400 million monthly.

Speaking at the OTL Africa Downstream Oil Conference in Lagos, Abdul-Hamid stated, “If the refinery reaches 650,000 barrels per day capacity, Nigeria alone cannot consume all that volume. Instead of importing from Europe, we can source from Nigeria, reducing freight costs and potentially lowering prices across goods and services.”

Dangote Refinery was in advanced talks to export fuel to South Africa, Angola, Namibia, and four additional countries: Niger, Chad, Burkina Faso, and the Central African Republic.

A source familiar with the operations revealed, “Discussions are at advanced stages with Ghana, Angola, Namibia, and South Africa, while initial talks are ongoing with Niger, Chad, Burkina Faso, and the Central African Republic.”

The report noted that the refinery’s gasoline shipment is currently floating off Lome, Togo’s coast, a hub for ship-to-ship fuel transfers. While the ultimate destination of the cargo remains unclear, this development highlights Dangote’s readiness to ramp up production and expand its export reach.

Last month, the refinery also shipped its first seaborne gasoline cargo to Lagos, a commercial hub.

Though small compared to the global gasoline market, these initial exports underscore the refinery’s potential to disrupt regional fuel markets. However, whether significant volumes of Dangote’s gasoline will be exported long-term remains uncertain.

This move follows the Federal Government’s decision to end the state-owned oil company’s monopoly on sourcing fuel from the refinery for domestic use. Meanwhile, fuel imports from Europe and the U.S. continue under regulatory provisions.

Efforts to obtain comments from Dangote Refinery’s spokesperson were unsuccessful at the time of reporting.