Delay in Crude Supply Leads to Postponement of Dangote Refinery and Others’ Operations

Production of refined petroleum products at domestic refineries, including the Dangote Refinery, has been halted due to a shortage of crude oil supply.

Additionally, the 650,000 barrels per day Dangote refinery in Lagos missed its projected production target for October.

This is the second time in 2023 that the Dangote Refinery has failed to meet expectations, further delaying Nigeria’s goal of ending petrol importation.

According to industry sources, Nigeria’s domestic refineries, including five modular refineries, are unable to produce refined products due to the lack of crude oil supply.

The Dangote Refinery in Lekki, Lagos has also not yet received the required volumes of crude oil for production of refined products.

NewsNow had previously reported that on September 20, 2023, the Dangote Petroleum Refinery stated it would receive its first cargo of crude oil in two weeks.

However, the Nigerian National Petroleum Company Limited (NNPCL) had already committed its crude oil to other entities, as revealed by the Executive Director of Dangote Group, Devakumar Edwin.

Edwin further mentioned that the importation of crude by the Dangote Refinery was temporary, as the company would start receiving supply from NNPCL in November.

Despite the promise of production in October, there has been no evidence of diesel refining from the facility. The crude oil supply situation remains unchanged, as NNPCL struggles to provide the necessary crude oil.

Officials from the Dangote Refinery have reportedly complained about the lack of crude oil required by the plant to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

Efforts to contact the Dangote refinery for comment were unsuccessful.

Although the Federal Government attributed the issue to Nigeria’s low oil output, operators of domestic refineries raised concerns about the lack of feedstock.

Furthermore, oil marketers have criticized the continued export of crude oil at the expense of local refineries capable of producing refined petroleum products.

The NUPRC has announced steps to ensure the provision of crude oil to domestic refineries and has urged oil companies to prioritize domestic refining.