“Africa’s Largest Oil Refinery Commences Production in Nigeria, Aiming to Reduce Dependency on Imports”

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"Africa's Largest Oil Refinery Commences Production in Nigeria, Aiming to Reduce Dependency on Imports"

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ABUJA, Nigeria — Africa’s largest oil refinery has commenced production in Nigeria, announced the company, bringing an end to a years-long wait for a plant that analysts said on Monday could enhance refining capacity in a region heavily dependent on imported petroleum products.

The $19 billion facility, with a capacity to produce 650,000 barrels per day, has started producing diesel and aviation fuel, according to a statement by the Dangote Petroleum Refinery company on Saturday. Being Nigeria’s first privately owned oil refinery, the project “is a game-changer for our country,” it added.

Despite being one of Africa’s leading oil producers, Nigeria has been importing refined petroleum products for its domestic use. The nation’s oil and natural gas sector has faced challenges for many years, with most of its state-run refineries operating significantly below capacity due to inadequate maintenance.

According to Olufola Wusu, an oil and gas expert who was involved in reviewing Nigeria’s national gas policy, the Dangote refinery is “not a silver bullet” for Nigeria’s energy crisis. However, he believes it will significantly revitalize the sector and transition Nigeria from a major importer of refined petroleum products to self-sufficiency in domestic refining capacity.

Described by the company as the world’s largest single-train refinery, the private refinery is owned by Aliko Dangote, Africa’s richest man and a prominent Nigerian industrialist. Situated on the outskirts of Lagos, Nigeria’s economic hub, the refinery operates alongside a fertilizer plant.

The plant is expected to fulfill 100% of Nigeria’s requirements for gasoline, diesel, kerosene, and aviation jet fuel once operating at full capacity, as stated by Dangote last year when the facility was inaugurated. Additionally, the company has indicated that at least 40% of the oil products produced will be available for export.

Although the plant has received approximately 6 million barrels of crude from Nigeria’s state oil firm, NNPC Limited, to initiate its operations, it may take several months before reaching full production capacity, according to analysts.

Some citizens are hopeful that the new plant will soon contribute to reducing consumer gas prices, which have tripled from a year ago after the government terminated decades-long subsidies.

Analysts have cautioned that any impact on prices will still depend on industry factors such as the cost of crude oil, government policies like subsidies, and the local currency’s exchange rate against the dollar.