Aliko Dangote, Chairman of Dangote Refinery and Petrochemicals Company Limited, has stressed the urgent need for Nigeria to enhance its crude oil production capacity and optimize domestic crude supply in order to transition from a net importer to a net exporter of petroleum products.
He made this call during his keynote address at the summit of the Crude Oil Refinery Owners Association of Nigeria (CORAN), held in Lagos.
The event gathered key stakeholders from Nigeria’s midstream and downstream sectors, as well as top government officials.
In his speech, Dangote highlighted Nigeria’s untapped potential to lead Africa’s petroleum industry.
Despite producing over 3.4 million barrels of crude oil per day, the continent still imports an estimated 3 million barrels of petroleum products daily, costing Africa about $17 billion in 2023.
Much of these imports come from Europe, Russia, and other regions, which Dangote believes presents Nigeria with an opportunity to become a major refining hub.
“Both the crude oil and petroleum products will travel shorter distances. The logistics costs of floating storage will be eliminated, and countries can purchase their petroleum product requirements just-in-time.
“ Nigeria and Africa can become completely self-sufficient, and we can keep all the value on our shores. We have done it in cement, and we can certainly do it for petroleum products,” he stated.
Dangote noted that the Dangote Refinery has already made significant strides in the industry, producing enough diesel and jet fuel to meet Nigeria’s demand.
PLATFORM TIMES reports that with the recent commencement of Premium Motor Spirit (PMS) production, the refinery is poised to further bolster Nigeria’s capacity to meet local needs while exporting to markets in Europe, Brazil, the United States, and Asia.
Represented by Engr. Mansur Ahmed, Group Executive Director of Dangote Industries, Dangote called for Nigeria to increase its refining capacity to 1.5 million barrels per day.
He stressed that this would require prioritising domestic crude supply obligations.
According to him, the government must incentivize investors to stimulate growth, contrasting this with the Dangote Refinery, which was built without government incentives.
Dangote lamented that, while nations like Norway invest their oil proceeds into future funds, African countries continue to deplete their oil wealth.
He acknowledged the Tinubu administration’s efforts to fast-track divestments from International Oil Companies (IOCs) and expand crude oil production to meet the growing demand from new refineries.
“The government of President Bola Ahmed Tinubu is taking active steps to achieve this through fast-tracking IOC divestments and other initiatives,” he remarked.
On the global stage, Dangote noted that shifts in the European petroleum sector will likely disrupt traditional trade flows, offering Nigeria an opportunity to capitalize on emerging trends.
He emphasised that Nigeria’s ability to become a major player in global oil markets hinges on collaboration between the government, industry stakeholders, and investors.
“As a vibrant exporter of refined products, Nigeria will witness an improvement in its balance of trade and generate much-needed foreign currency.
“ Nigeria’s potential as a refining hub is clearly not in doubt; let us work together to make it happen,” he urged.
Speaking further on Nigeria’s transformation, Dangote asserted that the idea of Nigeria becoming a net exporter of refined petroleum products would have seemed far-fetched just a few years ago.
However, with the Dangote Refinery now operational, the country is set to turn this vision into reality, transforming itself into a key player in global downstream trade.
Commending Dangote’s efforts, Abdulrazaq Isa, Chairman of Waltersmith Refinery & Petrochemicals Co. Ltd and the Independent Petroleum Producers Group (IPPG), urged the Nigerian government to support local refiners by ensuring consistent crude supply and addressing issues such as pricing and smuggling.
Isa stated that this would help secure the future of Nigeria’s refining sector.
Captain Emmanuel Iheanacho (rtd), Chairman of CORAN’s Board of Trustees and CEO of Integrated Oil & Gas, praised the Dangote Refinery for producing Euro-V standard products, which reduce citizens’ exposure to harmful high-sulphur fuels.
He pointed out that achieving self-sufficiency in petroleum refining will require significant investment in crude oil production, warning that Nigeria loses approximately $83 billion annually by failing to meet its OPEC quota.
Iheanacho further called on the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to consider cancelling import licenses, as Nigeria is now well-positioned to meet its local fuel needs.
Echoing this sentiment, Huub Stokman, Chairman of the Major Energy Marketers Association of Nigeria (MEMAN), said Nigeria is on the brink of becoming Africa’s refining powerhouse.
He remarked that this transformation will have profound economic benefits for the country and the continent.
Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, assured attendees that the government is committed to refining its framework to enhance crude production and support domestic refiners.
Similarly, the Minister of Industry, Trade, and Investment, Dr. Doris Uzoka-Anite, reiterated the Tinubu administration’s focus on ensuring value addition for mineral resources before they are exported.
The summit concluded with two panel sessions that delved into Nigeria’s downstream petroleum sector and explored strategies to achieve self-sufficiency in petroleum products, underscoring the critical role of collaboration and investment in realising Nigeria’s refining potential.
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