Dangote’s Refinery Commencement to Reduce Foreign Exchange Demand by 40%
In a major breakthrough, Aliko Dangote, the billionaire businessman, has announced the commencement of petrol production at his Dangote refinery located in Lagos, Nigeria. According to Dangote, the introduction of naira for crude will significantly reduce the demand for foreign exchange by 40%.
During an interview on Arise TV, Dangote expressed his gratitude to the people of Nigeria and President Bola Tinubu’s government for creating an environment that enables his business to thrive. He credited Tinubu’s idea of introducing naira for crude and naira for product with providing stability to the Naira and reducing the demand for dollars by 40%. Additionally, Dangote pointed out that round tripping, a common practice in the industry, will be minimized with this new policy.
The commencement of petrol production at the Dangote refinery will also make it possible to track loaded trucks, facilitating the computation of national consumption. As Dangote explained, "Now that we have this refinery working, it will show the true consumption of Nigeria. We can track each loaded truck and we will try as much as possible to track the loaded ships. Trucks, we can tell you where they are and for some of the products we have, we can tell you the consumption."
The development comes after the Federal Government announced in April that indigenous refineries can now buy crude oil in naira or dollars. The government also disclosed that Nigeria’s total crude oil and condensate reserves have increased to 37.5 billion barrels as of January 1, 2024, with a life index of 68.01 years.
The Dangote Refinery, which has the capacity to process 650,000 barrels of oil per day, will convert more than half of its output into petrol, significantly boosting the country’s oil production.
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