Analyst at the Standard and Poor’s Global Commodities Insights have projected that the Dangote refinery will start supply of petrol in the fourth quarter of this year rather than the next month being stated by the company.
This was disclosed by Kelly Norways- an African energy expert at the S&P podcast titled “Exploring West Africa’s oil product flows in a changing refining landscape” where its analysts shared insights on the latest trends in the energy market across Europe and West Africa.
She commented on the impact of the Dangote refinery to significantly reduce energy imports across the West African sub-region putting the figure for petrol as much as 290,000 barrels daily from 2024 and 2026.
In her words, “We are starting to see signs of activities, but all eyes are on when we’ll start to see gasoline production will commence from that project. There is a significant amount of pressure from the Nigerian government for significant volume of that supply to be sent to the domestic market.”
“In reality, when we see that start scale up is still subject to debate. Dangote has recently been espousing some punchy timelines. They have most recently been saying that they are looking to produce gasoline by May. But in reality, our analyst expect that would be something like the fourth quarter of this year in a more realistic timeline.”
Change in petroleum product supply to West Africa
Furthermore, the discussion delved into the changing dynamics of petroleum product flow into West Africa in the past few months with reduced supply of petroleum products into Africa following reduction from hitherto traditional suppliers the Netherlands.
It noted that the decline in supply from the Netherland’s Amsterdam and Rotterdam refineries was due to improvements in quality and new regulations from those places since 2022.
Backstory
The Dangote refinery was officially commissioned in May 2023 but has not been able to operate at full capacity due to series of delays. However, it began receiving crude oil around December and finally started distribution of diesel to marketers in the local market in March.
Last week, the refinery announced the reduction in the price of diesel to N1000/litre following the increase to around N1500 per litre being sold around.
