Dangote Set to Flood African Market with Refined Petroleum Products, Sending Jitters
There was unease in the global oil production market yesterday, when it came to light that the much-awaited Dangote Petroleum Refinery and Petrochemicals plant may soon become fully operational as early as January, as the first refinery in Africa in the last 40 years, with most of the 54 African country still major importer of refined petroleum product.
Dangote Petroleum Refinery coming on stream and expected to sell the product cheaper, sent jitters in the market.
This was just as the Dangote Petroleum Refinery and Petrochemicals plant yesterday, confirmed the purchase of one million barrels of crude oil of Agbami grade from Shell Trading and Shipping Company Limited (STASCO), one of the largest trading companies in Nigeria and globally, which trades over eight million barrels of crude oil per day.
Also, President Bola Tinubu has expressed optimism about the prospects of increased investments from Shell Petroleum Development Company of Nigeria (SPDC), emphasising Nigeria’s long-term relationship with the company, which discovered the first commercial oil field at Oloibiri in the Niger Delta in 1956.
The Aliko Dangote-owned company confirmed the purchase of the crude yesterday, in a statement issued by the Group Head, Branding and Corporate Communications, Dangote Group, Mr. Tony Chiejina, revealing that the next four out of the six cargoes programmed for supply to the facility will be supplied by the Nigerian National Petroleum Company Limited (NNPC) in the next two to three weeks.
The company also said the final shipment would come from ExxonMobil, reiterating that the refinery has the capacity to load 2,900 trucks a day at its truck loading gantries.
However, both the Africa’s richest man and chief promoter of the $19 billion refinery, Dangote and the Country Chair of Shell Companies in Nigeria, Mr. Osagie Okunbor, expressed delight at the major milestone recorded towards boosting Nigeria’s domestic refining capacity and attaining energy security and self-sufficiency.
According to the statement, the STASCO cargo contained one million barrels from Agbami and sailed to Dangote Refinery’s Single Point Mooring (SPM) where it was discharged into the refinery’s crude oil tanks.
The company said the maiden one million barrels, which represented the first phase of the six million barrels of crude oil to be supplied to Dangote Petroleum Refinery by a range of suppliers, should sustain the initial 350,000 barrels per day to be processed by the facility.
“The next four cargoes will be supplied by the NNPC in two to three weeks and the final of the six cargoes will be supplied by ExxonMobil”, the statement noted.
It added that the supply would facilitate the initial run of the refinery as well as kick-start the production of diesel, aviation fuel, and Liquefied Petroleum Gas (LPG) before subsequently progressing to the production of Premium Motor Spirit (PMS) popularly known as petrol.
This latest development would play a pivotal role in alleviating the fuel supply challenges faced by Nigeria as well as the West African countries.
Designed for 100 per cent Nigerian crude with the flexibility to process other crudes, the 650,000 barrels per day Dangote Petroleum Refinery can process most African crude grades as well as Middle Eastern Arab Light and even US Light tight oil as well as crude from other countries.
The Lagos’ Lekki Free Zone-based refinery could also meet 100 per cent of the Nigeria’s requirement of all refined products, gasoline, diesel, kerosene, and aviation jet, and also have surplus of each of these products for export.
The refinery was built to take crude through its two SPMs located 25 kilometres from the shore and to discharge petroleum products through three separate SPMs.
In addition, the company reiterated that the refinery has the capacity to load 2,900 trucks a day at its truck loading gantries.
Dangote Refinery has a self-sufficient marine facility with the ability to handle the largest vessel globally available. In addition, all products from the refinery will conform to Euro V specifications, according to the statement.
The refinery was designed to comply with US EPA, European emission norms, and Department of Petroleum Resources (DPR) emission/effluent norms as well as African Refiners and Distribution Association (ARDA) standards.
Commenting on the latest milestone achieved in the refinery’s journey, President of Dangote Group, Dangote, was quoted to have stated: “We are delighted to have reached this significant milestone. This is an important achievement for our country as it demonstrates our ability to develop and deliver large capital projects.
“Our focus over the coming months is to ramp up the refinery to its full capacity. I look forward to the next significant milestone when we deliver the first batch of products to the Nigerian market.”
Also, the Country Chairman of Shell Companies in Nigeria, Okunbor stated: “We welcome the startup of a refinery that is designed to produce gasoline, diesel, and low-sulphur fuels for Nigeria and across West Africa and are happy to be enabling it.”
Tinubu Optimistic of Increased Investments from SPDC
Meanwhile, Tinubu has expressed optimism about the prospects of increased investments from SPDC, emphasising Nigeria’s long-term relationship with the company, which discovered the first commercial oil field at Oloibiri in the Niger Delta in 1956.
Receiving at the State House, Abuja, the management of Shell Group, led by its Global Integrated Gas and Upstream Director, Ms. Zoe Yujnovich, the President, according to a statement issued yesterday, by his Media Adviser, Ajuri Ngelale, said his administration would continue to ensure the security and viability of existing and new investments in the country.
According to him: “We have made progress since our last meeting. I will continue to support and encourage you on this path. There is no doubt that there is a significant focus on investment in and around the continent. I am spearheading Nigeria’s global march for new investments at home.
“In view of our long-term relationship that has been established over the years, we want you to do more, and we are ready to encourage you in every way possible.
“We are very focused on resolving all investment-related issues. There is no bottleneck that is too difficult for us to remove in our determined march toward making Nigeria the African haven for large-scale investment in all key sectors. We need each other”.
Earlier in her remarks, Ms. Yujnovich expressed Shell’s commitment to maintain its legacy of investments in Nigeria, particularly as the company refocuses its investment to key into new and existing opportunities in the Deepwater and Gas sector.
She outlined the company’s dedication to the development of the gas value chain in the country, including a substantial commitment of $1 billion over the next five to 10 years, aimed at unlocking gas resources for domestic use and the Nigeria Liquefied Natural Gas (NLNG) project.
Furthermore, Ms. Yujnovich announced an imminent $5 billion investment opportunity in the Bonga North project off the shores of Nigeria, located in the deep water.
The Shell Global Integrated Gas and Upstream Director expressed Shell’s eagerness to proceed with this investment and outlined several prospective investments that Shell Group is eyeing in Nigeria over the short to medium term.
Her words: “Mr. President, I want to be successful in my role, and I cannot be successful in my role unless I can find a way to bring more new investments to Nigeria.
“I have made commitments to our investors that we will continue to invest in gas and oil. In Nigeria, I see all the conditions to continue to make this partnership stronger. In the deep water, we have an imminent investment opportunity in Bonga North. This is $5 billion. I am really keen to make that investment as soon as possible. We want to continue and build a pipeline of new investments in Nigeria”.
She commended the collaboration her team has experienced with the Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri and the Special Adviser to the President on Energy, Olu Verheijen, while acknowledging their roles in achieving significant progress in actualizing the potential of these projects as well as others.
THISDAY
