The Dangote Refinery is expected to commence crude oil production before the end of the year, according to a new report released by S&P Global.
The report revealed that Dangote’s upstream oil assets, specifically Oil Mining Leases (OMLs) 71 and 72, located in the Niger Delta, are projected to begin pumping about 40,000 barrels of crude oil per day (bpd) in the initial phase of production.
“Dangote’s upstream assets in the Niger Delta, Oil Mining Lease 71 and 72, could soon provide another supply injection, with production expected to start this month and reach up to 40,000 b/d,” the report stated.
The report also noted that Alhaji Aliko Dangote, Group President of the Dangote Industries Limited, remains committed to expanding the conglomerate’s energy footprint through new upstream opportunities, which would strengthen the group’s asset base and domestic supply capacity.
While the refinery has faced early challenges in sourcing crude oil, S&P Global highlighted that the company recently achieved a breakthrough supply agreement with the Nigerian National Petroleum Company Limited (NNPC) to ease constraints.
Under the current “crude-for-naira” swap deal, NNPC supplies Dangote with 14 crude oil cargoes — or the equivalent value in U.S. dollars — in exchange for an equivalent volume of gasoline and gasoil to be delivered in naira.
Industry observers believe the commencement of local crude production by Dangote’s upstream arm will not only enhance the refinery’s efficiency but also reduce Nigeria’s dependence on importedpetroleum products, solidifying the country’s march toward energy independence.
