Dangote Refinery Begins Gasoline Processing Amid Crude Shortages

Dangote Oil Refinery in Nigeria has started producing gasoline following delays due to crude shortages. The $20 billion refinery, owned by billionaire Aliko Dangote, aims to reduce Nigeria's dependence on imported oil products. NNPC, the country's sole gasoline importer, will exclusively buy the fuel once available, easing long-standing supply issues.

Nigeria's Dangote Oil Refinery has started producing gasoline after overcoming delays caused by crude shortages, an executive announced on Monday.

The $20 billion refinery, situated on the outskirts of Lagos and built by Nigerian billionaire Aliko Dangote, commenced operations in January, producing items such as naphtha and jet fuel. With a capacity of 650,000 barrels per day, the refinery is expected to mitigate Nigeria's costly dependence on imported oil products.

Devakumar Edwin, a vice president at Dangote Industries Limited, revealed that testing of the gasoline product is underway, and it will soon be transferred to product tanks. He refrained from specifying when the gasoline would reach the local market.

Edwin mentioned that NNPC Ltd, the state's sole gasoline importer, would exclusively purchase the gasoline. He indicated that if there are no buyers, the gasoline could be exported, similar to the refinery's aviation jet fuel and diesel exports.

The introduction of Dangote's gasoline into the Nigerian market aims to ease NNPC's challenges in supplying the local market, as it currently faces $6 billion in debts to oil traders since January. This financial strain has impacted its supply capabilities, leading to fuel shortages from July onwards.

Fuel prices have surged by 45% from the official price of 617 naira ($0.3942) since subsidies were removed last year. Clementine Wallop, director of sub-Saharan Africa at political risk consultancy Horizon Engage, emphasized the critical timing of Dangote's gasoline processing, considering NNPC's financial struggles in securing imported supply. She highlighted the pressing need for greater transparency in NNPC's financial dealings.

Nigeria, despite being Africa's top oil producer, imports nearly all its fuel due to longstanding neglect of its national refineries.

($1 = 1,565.0000 naira)

(With inputs from agencies.)