The Dangote refinery in Nigeria, Africa's biggest and newest crude processing facility, is set to soon begin production of gasoline, potentially upending global gasoline flows.
For years, Nigeria has been importing the gasoline it consumes, but the newly operational refinery is poised to turn OPEC's largest African crude oil producer from a gasoline importer to a gasoline exporter, impacting fuel market balances, especially in Europe.
The Dangote refinery began the production of fuels in January 2024, marking the start-up of the plant that has seen years of delays.
The facility has yet to begin production of gasoline, but it is on the brink of producing large volumes of the fuel, sources familiar with the operations told Bloomberg on Monday.
The refinery is primarily using Nigerian crude, but it is also buying U.S. crude and Brazilian crude as feedstock.
The facility, which has a processing capacity of 650,000 barrels per day (bpd), will meet 100% of Nigeria's demand for all refined petroleum products and will also have a surplus of each of the products for export.
It is expected that once the refinery is fully operational at some point in 2025, more than half of its processing capacity will be earmarked for gasoline production.
The Dangote refinery expects to export diesel to customers in Europe, as well as gasoline to Latin American and African markets. However, production of Euro V gasoline, the gasoline complying with Europe's emissions standards, is not expected to be produced until late 2024, according to analysts at Facts Global Energy.
In the middle of June, the Dangote group's president Aliko Dangote told Nigerian media that the refinery was delaying the start of gasoline deliveries after the middle of July.
Back then, Dangote, Africa's richest man, said that the refinery would be able to take gasoline to the market by the third week of July.
This timeline has slipped, and most industry analysts expect considerable volumes of gasoline out of Nigeria to hit international markets next year.
By Charles Kennedy for Oilprice.com
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Comments
Seems pretty strong for one 650,000 BPD refinery in a global market of 27,000,000 BPD of gasoline demand. Total gasoline production will be on the order of 1% of global demand.
Beyond that, gasoline seems an odd focus these days. We need to reduce use of fossil fuels, not increase them, and the light-duty vehicle sector is the easiest place to start, via electrification. U.S. and European refiners are working to make more diesel and jet fuel and LESS gasoline.