Dangote Refinery Set To Buy 24 Million Barrels Of US Crude Oil
Dangote Oil Refinery in Lagos is seeking to buy millions of barrels of US crude over the next year as it ramps up processing rates.
According to a document seen by Bloomberg, the Dangote plant, built by Africa’s richest man, Aliko Dangote, issued a so-called term tender for the purchase of 2 million barrels a month of West Texas Intermediate Midland crude for 12 months starting in July.
The tender for overseas oil — from a refinery that’s situated in Africa’s largest producer nation, highlights how influential the plant will be in global crude and fuel trading. It will be the largest fuelmaking facility in Africa when fully up and running.
The tender closes at 3 p.m. on May 21.
The tender shows how Nigerian crudes are struggling to compete against American supply, one trader of West African barrels said.
An official at Dangote didn’t immediately respond to a request for comment.
The refinery is a 650,000 barrels per day (BPD) integrated refinery project under construction in the Lekki Free Zone near Lagos, Nigeria. It is expected to be Africa’s biggest oil refinery and the world’s biggest single-train facility.
In March, the Nigerian government stated that it would be very embarrassing if Port Harcourt, Kaduna, Warri, Dangote and BUA refineries did not get enough crude oil locally for the production of petroleum products after they were fully ready.
The Minister of State Petroleum Resources (Oil), Heineken Lokpobiri, said the refineries and modular refineries in the country might not get enough crude oil locally without an increase in production in the sector.
