DANGOTE REFINERY BEGINS PETROL PRODUCTION TEST-RUN– REPORT

Dangote Refinery, one of Africa's largest industrial projects, is currently undergoing test runs for the production of Premium Motor Spirit (PMS), commonly known as petrol. According to a report by Reuters, the test runs are set to lead to full operation by mid-September 2024. However, this date could be extended depending on the outcome of the ongoing tests.

Oil marketers in Nigeria, particularly members of the Major Energies Marketers Association of Nigeria (MEMAN) and the Independent Petroleum Marketers Association of Nigeria (IPMAN), are keenly awaiting the price of the petrol that will be produced by Dangote Refinery. The price is crucial as it will determine the competitiveness of Dangote’s petrol in the market. Currently, the cost of petrol at the pump in Nigeria is reported to be lower than the actual market price, which could pose challenges for marketers if the refinery prices its products at market rates.

The refinery, valued at $20 billion, is expected to have a significant impact on Nigeria's fuel market, potentially reducing the need for imports. Despite the delays in the refinery’s start date—from June to August, and now September—the project remains highly anticipated.

The Federal Government has also been involved in discussions with the Dangote Refinery, particularly regarding the sale of crude oil to the refinery in naira, which is set to commence on October 1, 2024. This aligns with the government's broader objective of enhancing local refining capacity.

As the refinery nears full operational capacity, it is carefully blending and testing its products to meet the required specifications, ensuring that when the petrol is released to the market, it meets all regulatory standards.

In summary, the Dangote Refinery is on the verge of commencing full-scale petrol production, a development that could reshape Nigeria’s oil and gas sector. However, the market is closely watching how the refinery's pricing will align with current market conditions.