Dangote Refinery Resumes U.S. Crude Purchases Amid Rising Oil Production Goals

Lagos, Nigeria – The Dangote Petroleum Refinery has restarted the importation of crude oil from the United States after a three-month pause, aiming to enhance refining capacity and boost production. A shipment of two million barrels of WTI Midland crude, supplied by Chevron Corporation, is scheduled to arrive at the refinery in December, Bloomberg reported on Wednesday.

This marks a renewed push for crude supply diversification, following an earlier agreement with the Nigerian government for crude purchases in naira.

Key Highlights of the Recent Developments

Return to U.S. Crude Imports

After a temporary focus on local crude supplies under a naira-for-crude agreement with the Nigerian National Petroleum Company Limited (NNPCL), the Dangote Refinery is once again sourcing from international markets. The refinery had previously imported one or two supertankers of U.S. crude monthly but scaled back in August.

Chevron has chartered the supertanker Azure Nova to deliver the shipment, with loading expected in early December from the U.S. Gulf.

Challenges with Local Supply

The NNPCL had agreed to provide up to 400,000 barrels of Nigerian crude daily, paid in local currency. However, limited supplies from the agreement may have prompted the refinery to seek alternatives. Reports suggest lower shipping costs have also made U.S. oil more affordable in European markets, increasing the refinery’s competitive edge.

Financing and Expanding Operations

The refinery is seeking substantial funding to secure crude supplies and meet its refining targets. According to Bloomberg, Dangote Group Chairman Aliko Dangote is in discussions with banks, oil traders, and development agencies to raise billions of dollars for crude procurement.

The facility, with a minimum crude processing requirement of 300,000 barrels per day (b/d), aims to fully utilize its refining capacity of 650,000 b/d.

Exporting Refined Products

On Tuesday, the refinery began exporting refined petroleum products to West African countries, signaling its growing role in reshaping regional fuel markets.

Refinery’s Landmark Achievement

The Vice President of Oil and Gas at Dangote Industries Limited, Devakumar Edwin, highlighted the project’s groundbreaking nature during a Senate Committee on Trade and Investment visit to the refinery complex. Edwin praised the Dangote Group for accomplishing what international oil giants such as Shell and ExxonMobil had not done—building the world’s largest single-train refinery.

“This is the largest single-train refinery globally, achieved by a Nigerian company. It’s a testament to what we can accomplish when we rise to challenges,” Edwin stated.

Legislative Backing

Senate Committee Chairman Sadiq Umar assured the refinery of the National Assembly’s support, emphasizing its importance as a $20 billion national asset. “We will provide every legislative support necessary to ensure its success,” he said.

Production Milestones

Since commencing operations in January, the refinery has:

• Released diesel and aviation fuel into local markets.
• Begun production of premium motor spirit (PMS) in September.

Despite earlier disputes with international oil companies over crude supply, interventions by President Bola Tinubu facilitated access to local crude in naira. Plans to export petrol to neighboring countries are reportedly underway.