Dangote Takes Another Step to Release Petrol For Nigerians, Imports More Crude From Another Country
- Dangote Refinery is adding Brazillian Crude to its feedstock and has ordered about one million barrels of crude from the company
- Reports say the company is seeking to diversify its crude source as it prepares to make petrol available to Nigerians this month
- This is the first time Brazil will export its crude to Nigeria after Dangote secured another 11 million barrels from the US
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment, and the economy for over a decade.
Dangote Refinery is diversifying its crude oil supply by adding Brazilian crude to its feedstock.
Traders said the refinery is still ramping up full capacity, with a one-million-barrel cargo of Brazil’s Tupi Crude scheduled for delivery in the second week of August 2024.
Source: Facebook
Brazil exports crude to Nigeria for the first time
The move is the first time Brazil has exported its oil to Nigeria, per a report from the country’s commerce ministry.
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Chairman of the Dangote Group, Aliko Dangote, said that the refinery will continue crude oil import as it seeks to scale up production.
Dangote, who promised that petrol from the refinery would be available to Nigerians this month, had blamed international oil companies (IOCs) and other local crude producers of plots to undermine the refinery by inflating premium prices.
According to reports, the refinery took delivery of 11 WTI cargoes, or nine million barrels, between February and May 2024, in addition to the about 18 million barrels of Nigerian crude deliveries.
Dangote imports more crude from the US
The move to secure a longer-term agreement shows a commitment by the company to permanently diversify its crude sources as Nigeria battles an extreme decline in demand for its crude.
Legit.ng earlier reported that Dangote had announced plans to purchase an additional 11 million barrels of crude oil from the US.
The refinery, expected to roll out petrol across Nigeria this month, has found it necessary to augment domestic supply with imports to meet its operational needs.
Dangote refinery orders for 11 million barrels
According to a tender, the refinery bought five million barrels of West Texas Intermediate (WTI) Midland crude for delivery in August and September.
The firm also began a tender process to purchase another six million barrels of American crude for September.
The facility runs mostly on local crude supplies that can reach the refinery from offshore terminals in a few days.
According to reports, the refinery took in over 41 million barrels of crude in the first half of 2024 as it completed test runs and slowly increased processing rates.
IOCs, oil companies get FG's order to supply Dangote crude oil
Legit.ng previously reported that the Nigerian government, through the Nigeria Upstream Petroleum Regulatory Commission (NUPRC), has agreed with oil producers to allow the sale of crude oil to local refineries at market prices.
The agreement will end a supply dispute between local refineries and oil producers, including international oil companies (IOCs).
The oil producers, under the aegis of the Oil Producers Trade Section (OPTS) of the Lagos Chamber of Commerce Industry (LCCI) at the behest of the NUPRC, agreed to yield to a scheme that would mutually benefit both parties and focus on ensuring that local refineries are not starved and ripped-off.
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Source: Legit.ng
