By Adedapo Adesanya
Dangote Refinery is set to import crude from the world’s largest oil producer, the United States, in the coming months.
According to Bloomberg, Trafigura Group has sold 2 million barrels of WTI Midland to the Dangote refinery for delivery by the end of February.
This marks the first time the refinery is buying non-Nigerian crude and signals the increasing competitiveness of American barrels in the global market.
The expansion of the US oil supply in the last decade has changed the world market and expanded its impact to areas like Asia and Africa. These transatlantic supplies are especially felt by Nigeria, whose economy is highly dependent on oil exports.
Business Post had reported in September 2023 that the 650,000 barrels per day refinery would not rely solely on Nigerian crude for its operations.
Mr Devakumar Edwin, the Dangote Group chief, the plant will not rely on Nigerian crude from the Nigerian National Petroleum Company (NNPC) Limited as it will consider other sources, including the US and Saudi Arabia.
He said it was not advisable for the plant to be solely dependent on Nigerian crude, as the refinery could process most African crudes as well as Middle Eastern Arab Light and even US light-tight oil.
He also didn’t rule out the possibility of Russian crude, which has been embargoed by Western countries and its allies following the country’s aggression in Ukraine.
The new 650,000 barrel-a-day oil refinery commenced operations earlier this month. Initially targeting a processing rate of 350,000 barrels per day, the refinery aims to gradually escalate production towards its full capacity.
The refinery before now primarily sourced domestic crude through a supply agreement with the trading arm of the state-owned Nigerian National Petroleum Company (NNPC) Limited. It recently received six shipments of Nigerian crude.
The $19.5 billion refinery, which was officially inaugurated by former President Muhammadu Buhari two weeks before the end of his administration in May 2023, will increase its production in phases. It has begun with the production of diesel and jet fuel.
Dipo Olowookere