Report Shows That Dangote Oil Refinery Ramps up Production With US Crude

Bloomberg reported on Thursday that Dangote Refinery has been shipping products as it prepares two units for petrol (petrol) output, which will transform the fuel market in Nigeria and the surrounding area. It attributed this to analysts.

However, according to Alan Gelder, vice president of refining, chemicals, and oil markets at Wood Mackenzie's consulting firm, he said, 

Dangote will influence Atlantic Basin petrol markets this summer and for the rest of the year. The RFCC's coming online will shake things up because it alters the West African gasoline supply balance.

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Based on the average estimate of analysts at WoodMac, FGE, and Citac, the refinery is operating at about 300,000 barrels per day, or nearly half its nameplate capacity. The complex has started shipping jet fuel, gasoil, and naphtha as it widens to a full slate of products, a report said.

However, some analysts anticipate the RFCC will take until the end of the year, while Wood Mackenzie anticipates the gasoline-focused units will go online this summer.

Dangote Industries announced earlier this month that fuel deliveries will start in May.  However, a company representative did not immediately answer questions.

According to news published in The PUNCH on Wednesday, the refinery declared that diesel prices would drop from N1,200 to N1,000 per litre. This announcement caused a stir among downstream oil industry participants.

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Dangote refinery announced this in a statement by its spokesperson, Tony Chiejina.

The statement read in part, "In an unprecedented move, Dangote Petroleum Refinery has announced a further reduction of the price of diesel from N1200 to N1,000/litre.

"While rolling out the products, the refinery supplied at a substantially reduced price of N1,200/liter three weeks ago, representing over 30 percent reduction from the previous market price of about N1,600/liter.

"This significant reduction in the price of diesel at Dangote Petroleum Refinery is expected to affect all the spheres of the economy positively and ultimately reduce the high inflation rate in the country."

According to shipping information compiled by the media house, Bloomberg reported on Thursday that as much as a third of the oil shipped into the giant refinery has been US-grade WTI Midland.

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On Tuesday this week, the Dangote refinery announced that the price of a litre of diesel would be reduced from N1,200 to N1,000.

The company expects the significant decrease in diesel prices to positively affect every aspect of the economy, including Nigeria's high inflation rate.

"In an unprecedented move, Dangote Petroleum Refinery has announced a further reduction of the diesel price from 1200 to 1,000 naira per litre.

"While rolling out the products, the refinery supplied at a substantially reduced price of N1,200 per liter three weeks ago, representing over 30 percent reduction from the previous market price of about N1,600 per liter.

"This significant reduction in the price of diesel at Dangote Petroleum Refinery is expected to affect all the spheres of the economy positively and ultimately reduce the high inflation rate in the country," the company said.