Dangote to Commence Crude Oil Production by Year-End
Dangote Group, owner of West Africa’s largest refinery, plans to start crude oil production at its Nigerian oil assets before the end of 2024, according to S&P Global Commodity Insights. The company is currently searching for a floating production, storage, and offloading vessel.
Key Highlights:
- Dangote Group to begin crude oil production in Q4 2024
- Initial production at 20,000 barrels per day (b/d)
- Output expected to increase in Q1 2025
- Dangote holds 85% stake in West African E&P Venture
- Nigerian National Petroleum Company (NNPC) holds 55% interest in Oil Mining Leases 71 and 72
The oil assets, located in the Niger Delta, contain the Kalaekule and Koronama oilfields. Dangote’s refinery has faced crude oil supply challenges, relying on imports from countries like Brazil and the US.
To address this, the federal government approved crude oil sales to Dangote in naira. The refinery has supplied petroleum products to NNPC and is expected to start sales to local marketers soon.
Background:
- Dangote Refinery, valued at $20 billion, has a 650,000 barrel-per-day capacity
- Once fully operational, it will be Africa and Europe’s largest refinery
- Aims to reduce Nigeria’s reliance on imported petroleum products
Nigeria, Africa’s top oil producer, currently imports nearly all its fuel due to insufficient refining infrastructure. The Dangote refinery is poised to address this gap.
