Dangote Refinery is set to significantly reduce its reliance on imported crude oil from the United States and increase its use of locally sourced feedstock.
The move comes as the refinery prepares to ramp up its petrol production in the coming months.
According to recent data compiled by Bloomberg, the refinery is expected to source over 80% of its crude oil from Nigerian suppliers in the third quarter of 2024.
This is a notable increase from the previous quarter, where less than 75% of the refinery’s feedstock came from domestic sources.
The shift is seen as part of a broader strategy to bolster Nigeria’s oil sector and reduce dependence on foreign crude.
The refinery has been operational since January 2024, after overcoming several delays.
It has processed more than 56 million barrels of crude oil since its test runs began. Of this, 78% has been Nigerian crude.
This strategic pivot aligns with the Nigerian government’s broader efforts to enhance local oil production and processing capabilities.
A senior official from Dangote Industries confirmed to Bloomberg that the refinery has taken six cargoes of crude directly from the Nigerian National Petroleum Company Limited (NNPC) for the upcoming month.
Additionally, two more shipments of Nigerian crude and 2 million barrels of WTI Midland from the U.S. are expected to arrive in September.
The decrease in U.S. crude imports comes as a result of the refinery’s decision to re-sell some of the American barrels it had previously purchased.
This adjustment has led to increased competition for U.S. crude in other markets.
Reports suggest that Dangote’s strategy may further reduce the need for overseas crude, particularly if a new system starting in October allows the refinery to purchase Nigerian crude in local currency.
The new system, introduced by the Nigerian government, could potentially involve up to 445,000 barrels of Nigerian crude per day. If fully utilized, this system could minimize the refinery’s reliance on foreign crude imports.
