By Bonface Orucho
Nigeria’s Dangote refinery, a 650,000 barrels per day facility, has recently exported its first-ever jet fuel cargo to Europe, a move that signals not just growing production but Africa’s potential to become a major player in the global petroleum market.
S&P Global in a report on May 30, explains that Bp, a British multinational oil and gas company, transported the cargo, a 45,000 mt supply, from Lekki to Rotterdam in the Netherlands. This is the first batch of the 120000 mt tender it was offered.
“The inaugural European shipment demonstrates the growing reach of products from (the 650,000 b/d) Dangote refinery as it has rapidly ramped up operations and aims to shake up established West African trade flows,” the S&P report explains.
Apart from Bp, Cepsa, a Spanish multinational oil and gas company headquartered in Madrid, Spain, has also been contracted to deliver an undisclosed amount of of jet fuel supply to the lucrative US$65 billion European market.
Less than a year since it was inaugurated, the refinery is proving to be a refining powerhouse.
According to industry experts, the first export of jet fuel to Europe milestone shows it’s flexing its muscles and raises hopes for the ability to transform Nigeria into a net exporter of petroleum products.
“This reality would be a major economic boon for Nigeria and a significant step towards Africa’s energy independence,” Monica Amutala, a Kenyan entrepreneur in oil and gas and an economist, explains.
Yet, it is not just the international market that is witnessing the impact of this transformative project. Initiatives are in top gear that promise to satisfy not only Nigeria’s domestic demand for refined products but also that of the continent.
At a May Africa CEO Forum in Kigali, Aliko Dangote, Africa’s richest man and CEO of Dangote conglomerate (which owns the refinery), hinted Nigeria could see domestic gasoline supply begin this month.
“Right now, Nigeria has no cause to import anything apart from gasoline and by sometime in June, within the next four or five weeks, Nigeria shouldn’t import anything like gasoline; not one drop of a litre,” he explained.
Already, the facility is serving key markets within Nigeria and across West Africa with kerosene and other refined products. Dangote has exported six cargos of jet fuel/kerosene, all of which were delivered to Senegal, Togo, or Ghana.
The economic significance of this is huge, Nigeria spent more than US$8 billion (about N12trn) on the importation of petroleum products, including premium motor spirit (PMS), also known as petrol, in 2023.
Despite producing almost 10 million barrels per day, representing about 10% of global crude oil production, an estimated total of 1.9 million bpd of refined products are currently being imported by African countries, costing countries billions of dollars.
In a June interview on CNN, Aliko Dangote explains that “Africa will destroy the industrialization of Africa, if we continue to import.”
“The more you import, you are importing poverty into your continent and exporting jobs. Because wherever you are importing from, you are encouraging them to keep expanding. When they expand, they recruit more people, give more jobs to their people. But here, the little jobs that we need to create are destroyed. So, I’m not a big fan of imports,” he explained.
However, according to industry analysts, the biggest impact of the Dangote refinery in the long run will be when it makes the West-African country self-sufficient by utilising its vast supply of crude oil.
“Shifting dynamics towards utilising our own abundant crude reserves within the continent would be a game-changer. It would bolster regional trade, create jobs in the oil and gas sector across Africa, and enhance our overall energy security,” Amutala explained.
The Dangote refinery is currently importing crude oil from the US (West Texas Intermediate Midland) due to a range of reasons among them; a declining production in Nigeria, higher quality and more favorable pricing, according to Bloomberg.
“Developing robust intra-African crude oil pipelines and fostering stronger trade partnerships between producing nations and refining institutions would be key steps in this direction,” she added.
bird story agency
Nigeria's Dangote refinery, a 650,000 barrels per day facility, has marked its debut in the global petroleum market by exporting its first jet fuel cargo to Europe. This shipment, facilitated by BP from Lekki to Rotterdam, indicates the refinery's rapid operational growth. Additionally, Spain's Cepsa has been contracted to supply the European market, which is valued at $65 billion. The refinery's expansion underscores Nigeria's potential to become a net exporter of petroleum products, enhancing Africa's energy independence.
Beyond international markets, Dangote refinery is also catering to Nigeria and other West African countries' domestic needs. The refinery, which has already sent several cargos of jet fuel/kerosene to neighboring countries, is poised to stop Nigeria's gasoline imports by June. In 2023, Nigeria spent over $8 billion on importing petroleum products. The refinery is expected to bolster regional trade, create jobs, and improve energy security in Africa by utilizing local crude reserves.
Currently, the refinery imports crude from the U.S. due to declining local production and favorable pricing. Industry analysts advocate for the development of intra-African crude oil pipelines and stronger trade partnerships to maximize the refinery's impact.
