Africa’s largest refinery could soon change global gasoline markets

Nigeria’s Dangote refinery, Africa’s largest and newest crude oil processing facility, is soon to start producing gasoline, which could change global gasoline flows.

For years, Nigeria has imported the gasoline it consumes, but the newly operational refinery is poised to transform Africa’s largest OPEC crude producer from a gasoline importer to a gasoline exporter, impacting the balance of the fuel market, especially in Europe.

The Dangote Refinery began fuel production in January 2024, marking the commissioning of the plant that had experienced years of delays.

The facility has not yet started producing gasoline, but is on track to produce large volumes of the fuel, sources familiar with the operations told Bloomberg on Monday.

The refinery mainly uses Nigerian crude oil, but also buys US crude oil and Brazilian crude oil 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 for export.

Once the refinery is fully operational sometime in 2025, more than half of its processing capacity is expected to be devoted to 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, gasoline that meets Europe’s emissions standards, is not expected to be produced until the end of 2024, according to analysts at Facts Global Energy.

In mid-June, Dangote Group chairman Aliko Dangote told Nigerian media that the refinery was delaying the start of gasoline deliveries beyond mid-July.

At the time, Dangote, Africa’s richest man, said the refinery would be able to bring petrol to market by the third week of July.

That timeline has slipped, and most industry analysts expect considerable volumes of Nigerian gasoline to hit international markets next year.

By Charles Kennedy for Oilprice.com

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