Contrasting Fortunes: Dangote Turns to Foreign Oil as NNPC Ships New Nigerian Crude to 2 Countries

• The Dangote Refinery has recommenced crude oil imports from the United States after a three-month break
• A report said that a cargo carrying two million barrels of crude oil from Chevron Corp will arrive at the refinery in December
• The new development comes three months after the $20 billion refinery promised to buy only Nigerian crude

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

After a three-month break, the Dangote Refinery has resumed importing crude oil from the US.

The move comes as the facility ramps production to meet growing domestic and regional demands.

The new crude supply is to arrive in December

A recent report disclosed on Wednesday, November 20, 2024 that a cargo carrying two million barrels of West Texas Intermediate crude from Chevron Corp will be delivered to the refinery in December.

The shipment will reportedly arrive at the plant in Lagos next month.

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NNPC begins sale of Utapate crude oil blend to international market

The new development comes three months after the $20 billion refinery promised to buy only Nigerian crude.

The refinery had struggled to source crude from the Nigerian National Petroleum Company Limited (NNPC), leading to imports from the US and Brazil.

Dangote Refinery's crude oil supply arrangement with FG

Reports say the reason was that the refinery bought crude from oil companies, including the NNPC, in dollars, prompting the Nigerian government to sell crude to it in naira.

Blomberg revealed that the 650,000bpd-capacity refinery may have opted to import from the US again despite the naira-for-crude sale arrangement with the Nigerian authorities.

Bloomberg quotes an anonymous source as saying that the refinery acquired two million barrels of WTI Midland crude from Chevron Corp., which will be delivered in December.

Expert says Dangote can import crude oil

An expert says the mega refinery can import crude despite its standing arrangement with the NNPC to buy the commodity in local currency.

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Dangote Refinery exports petrol to West African countries

Energy policy analyst Adeola Yusuf said the refinery can import crude from any country to meet its production demands.

“If you notice the gigantic nature of the facility, you’d see that waiting for crude oil supply from one source, in this case, the NNPC could spell disaster because it has to produce petroleum products continuously. 

So, it is within their rights to import irrespective of existing arrangement with Nigeria or any other seller,” he said.

NNPC exports Utakpe crude

Meanwhile, the NNPCL has commenced international sales of its latest crude oil grade, the Utapate crude oil blend. 

According to a statement by Olufemi Soneye, NNPCL’s chief corporate communications o, the new grade was unveiled to European crude oil marketers at the ongoing Argus European Crude Conference in London.

The development comes six months after exploration began at the Utapate field in Akwa Ibom State. 

Dangote refinery, marketers sign deal to lift petrol

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NNPC explains reasons for delay in completing Port Harcourt amid high petrol imports

Legit.ng earlier reported that the Dangote Refinery had reached a landmark agreement with the Independent Petroleum Marketers Association of Nigeria (IPMAN) to supply 60 million litres of petrol weekly, averaging 240 million litres monthly.

The arrangement would begin in the coming weeks and will give IPMAN about 240 million litres of petrol monthly, boosting the association’s distribution capacity.

IPMAN’s national publicity secretary, Chinedu Ukadike, said the deal would allow its members to lift petrol directly from the Dangote Refinery without involving intermediaries.

Proofread by Kola Muhammed, journalist and copyeditor at Legit.ng

Source: Legit.ng