Nigeria’s Dangote Refinery to Start Crude Oil Production Amid Feedstock Challenges
In a significant development, Nigeria’s Dangote Refinery is set to commence crude oil production, according to S & P Global Commodity Insights. This comes as the Nigerian oil firm is facing persistent feedstock challenges. The refinery plans to start production at its two Niger Delta upstream projects in Oil Mining Leases 71 and 72, with a initial output of approximately 20,000 barrels per day, which will gradually increase in the first quarter of 2025.
The production plans are in line with a recent Naira-for-crude deal between the Nigerian Government and Dangote Refinery. Under this agreement, the Nigerian National Petroleum Company Limited (NNPCL) will supply crude oil to the refinery in Naira, as directed by President Bola Tinubu. This move is seen as a bold step towards addressing the challenges faced by the Nigerian oil industry.
The development comes at a time when fuel prices have increased to N1030 per liter in Abuja, indicating the government’s efforts to stabilize the market. With this new production plan, Dangote Refinery is poised to make a significant impact on the country’s oil sector, despite the ongoing challenges.
As the Nigerian Government and its upstream and downstream oil companies work together to overcome the current hurdles, this step forward is likely to have a positive effect on the country’s energy landscape. The market is eagerly awaiting the start of production, which is expected to bring a boost to the economy.
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