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Traders with insider information revealed that Trafigura Group has sold 2 million barrels of WTI Midland to the Dangote refinery for delivery at the end of February, Bloomberg reported.
Traders have noted that this marks the first occasion where the refinery has procured crude oil from sources outside of Nigeria.
The surge in US oil supply over the past decade has reshaped the global market, extending its impact to regions as distant as Asia. This development is critical for Nigeria, Africa’s largest economy, whose economy heavily relies on petroleum exports.
A few weeks ago, the Dangote oil refinery commenced the production of diesel and aviation fuel after facing years of construction delays at the US$20 billion facility.
The refinery is obtaining domestic crude through a supply agreement with the trading arm of the state-owned Nigerian National Petroleum Co. The first crude delivery to the facility took place on December 12, 2023, and the sixth cargo was successfully delivered on January 8, 2024.
The first cargo that arrived at the plant was Nigeria’s Agbami crude, sold by a trading unit of Shell Plc. This was followed by more Nigerian barrels including the nation’s Amenam, Bonny Light and CJ Blend streams.
In addition to processing domestic feedstock, the new giant plant is designed to handle other African crudes, as well as supply from further afield, including the US and Saudi Arabia, according to statements from the Dangote Group earlier this month.
The refinery is expected to commence gasoline production by March, as reported by the The Guardian over the weekend, quoting Dangote himself. The refinery is expected to generate 27 million litres of diesel, 11 million litres of kerosene, and 9 million litres of jet fuel. — Business Insider Africaac
Online Reporter