The 650,000 barrels per day (bpd) Dangote Oil Refinery and Petrochemicals company has been described by international financial analytics firm S&P Global as having the capacity to both resolve Nigeria’s foreign exchange (forex) problem and relieve significant pressure on the local Naira currency while simultaneously accelerating the nation’s economic development.This was revealed by S&P Global, which has its headquarters in Manhattan, New York City, during an on-site visit to the Dangote Refinery in Ibeju-Lekki, Lagos, as part of its evaluation of Nigeria’s sovereign credit ratings.Federal Ministry of Finance representatives accompanied the delegation from the international rating agency. Nigeria’s oil industry would benefit from the world’s largest single-train refinery complex, according to S&P, but more significantly, Nigeria’s expanding economy would also benefit.The delegation was led by Ravi Bhatia, Director and Lead Analyst, Sovereign and International Public Finance Ratings, S&P Global Ratings, who stated that the Dangote refinery would turn Nigeria into a net exporter of petroleum products.
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He continued by saying that this shift is anticipated to increase revenue production and lessen the strain currently placed on the nation’s foreign exchange reserves. “When operating at full capacity, this facility can process 650,000 barrels per day, which is rather significant. It is the world’s biggest single-train refinery facility. It was released really swiftly. Nigeria exports a lot of crude oil, but it has trouble acquiring refined fuels.In light of this, there is a market niche where crude can be processed in Nigeria, saving money in the process and possibly saving some foreign exchange. This will be positive for the economy in the medium term. It looks positive from our assessment,” Bhatia said after an over four-hour tour of the facility.
Additionally, in an interview with the media, Dangote Industries Limited’s (DIL) Vice President of Oil and Gas, Devakumar Edwin, who guided the team through the facility, reaffirmed that the company hopes to spark a positive cycle of job creation, industrial development, and economic prosperity by using Africa’s plentiful crude oil resources to produce refined products locally. Additionally, he disclosed that the company will begin producing premium motor spirit (PMS) this month, July, as previously stated.Edwin stated that the $20 billion facility can supply all of Nigeria’s needs for aviation fuel, kerosene, diesel, and gasoline while also producing goods of a high caliber that satisfy international standards. Any excess fuel could be exported. The S&P team applauded Dangote Industries Limited President Aliko Dangote for incorporating cutting-edge technologies and quality control procedures, such as a cutting-edge Central Control Unit that guarantees seamless automation of processes. The associate director of sovereign ratings, Maxmillian McGraw; director of corporate ratings, Omegu Collocott; senior analyst of bank ratings, Charlotte Masvongo; and director of financial services, Samira Mensah, are among the other members of the international rating agency’s team. Edwin stated that although the refinery is now running at 350,000 barrels per day, it is expected to scale up to as least 500,000 barrels per day capacity by July/August, commencing the refining of petrol and ultra-low sulphur diesel.
He mentioned that the refinery complies with Euro V requirements and is built to process a variety of crudes, including light oil from the United States and various African and Middle Eastern countries. Furthermore, it is engineered to meet the emission criteria set forth by the US EPA, the European Union (EU), the Department of Petroleum Resources (DPR), the African Refiners and Distribution Association (ARDA), and other regulatory bodies. Although he acknowledged that foreign firms constructed the majority of refineries, he expressed satisfaction in the fact that a Nigerian company planned and constructed the largest single-train refinery complex in the world, serving as its own direct Engineering, Procurement, and Construction (EPC) contractor. Largest vessels in the world can be handled by the self-sufficient marine facility integrated inside the refinery.
“The refinery has the capacity to generate the best quality products in the world, Euro V grade. It is one of the energy-efficient refineries and it is highly environmentally friendly. It is sophisticated with a high level of automation. The largest single train refinery in the world is 100 per cent designed, engineered, and constructed by a Nigerian company as EPC contractor,” he said.Nigeria, one of the top producers of oil in the world, imports refined products since it lacks operating refineries and exports all of its crude oil for refining. To meet domestic demand, Nigeria is thought to import at least 50 million liters of gasoline daily.The National Bureau of Statistics (NBS) reported in its Foreign Trade Statistics for the Fourth Quarter of 2023 that Nigeria imported petroleum goods worth about N12 trillion in 2023, including premium motor spirit (PMS), or gasoline. When compared to the N10 trillion spent on petroleum imports in 2022, this amount represents a growth of 18.68%.
