"Cheap Fuel Is Here": Dangote Refinery Finally Commences Sale of Petroleum Products

• The executive director of the Dangote Group confirmed that Dangote Refinery has commenced sales of products
• He said that the products are evacuated through the sea and road as 26 million litres of the products are pushed for operations
• Based on agreement on the bulk purchase agreement, the local petroleum marketers will pay N1,225 ($0.96) per litre of diesel

Legit.ng journalist Zainab Iwayemi has over three years of experience covering the Economy, Technology, and Capital Market.

Devakumar Edwin, the executive director of the Dangote Group, announced on Tuesday, March 2, that the Dangote Refinery has started supplying petroleum products to the local market.

As reported by Reuters, this was verified by executives belonging to various associations of petroleum marketers.

Edwin said:

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“We have substantial quantities. Products are being evacuated both by sea and road. Ships are lining up one after another to load diesel and aviation jet fuel. Ships load a minimum of 26 million litres, though we try to push for 37 million litres vessels, for ease of operations.”

Petroleum products to sell cheaper

The president of the Independent Marketers Association of Nigeria (IPMAN), Abubakar Maigandi, spoke about selling diesel into the local market.

He said that local petroleum marketers set a price of N1,225 ($0.96) per litre of diesel after entering into a bulk purchase agreement and then added their markup.

He said the association's members own over 150,000 retail stations in Nigeria.

Smaller depots and petroleum marketers are reportedly looking for letters of credit to purchase petroleum products from Dangote.

Femi Adewole, the association's executive secretary, was quoted as saying:

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“Our members are discussing with banks, and these talks have reached advanced stages; when we have our letters of credit, we will begin lifting products."

Legit.ng reported that the Dangote Petroleum Refinery had started producing aviation fuel and diesel earlier in January.

Six million barrels of crude oil were delivered to the refinery at its two SPMs, 25 kilometres offshore, the business stated in a statement announcing the start of operations.

Recall that on December 12, 2023, the first delivery of crude oil was made, and on January 8, 2023, the sixth shipment was delivered.

One of the biggest trading businesses in Nigeria and the world, Shell International Trading and Shipping Company Limited (STASCO), sent over 8 million barrels of crude oil each day, and this was the first shipment to arrive at the factory. It was Agbami crude grade.

With the delivery of an extra million barrels of bright light crude from the Nigeria National Petroleum Company (NNPC Ltd.), the company took a step closer to starting the manufacturing of refined petroleum products.

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The second shipment to be transported to the Dangote facility is a fresh one million barrels of crude from the Shell terminal via the Trafigural-owned MT Otis. The world's largest single-train refinery is anticipating six million barrels of crude.

New refinery to come

Legit.ng reported that a Chinese cargo ship, laden with an Akwa Ibom refinery project consignment, had berthed in Calabar port in Cross River state.

The development was a significant milestone in constructing a state-of-the-art refinery in Akwa Ibom state.

BusinessDay reported that two refinery projects were expected in the Eket and Onna local government areas.

Source: Legit.ng