The Dangote Refinery in Nigeria is set to receive a significant shipment of 12 million barrels of crude oil from the United States as it faces challenges securing enough domestic supply to meet its refining needs. This move comes just weeks after reports highlighted the refinery’s efforts to expand its crude storage capacity by 6.29 million barrels in a bid to stockpile more imported feedstock.
According to an insider source cited by The Africa Report, the shipment, which has already left the US, is expected to arrive in Nigeria by February. The 12 million barrels of crude will provide much-needed feedstock as the refinery prepares to ramp up its operations.
The Dangote Refinery, which is set to reach a production capacity of 650,000 barrels per day (bpd) by June 2025, has been grappling with inconsistent domestic crude supply. The Nigerian National Petroleum Corporation (NNPC), which is responsible for meeting the country’s local consumption needs, has struggled to provide the 350,000 bpd needed by the Dangote Refinery from the total 450,000 bpd allocated to domestic consumption.
With Nigeria’s current production capacity at 500,000 bpd, the NNPC has been unable to fulfill the refinery’s growing demand for crude. Officials have emphasized the necessity of looking beyond Nigeria’s borders for feedstock to sustain operations.
A recent crude oil production forecast revealed that the Dangote Refinery would require 550,000 bpd of Nigerian crude, totaling 17.05 million barrels monthly or approximately 99.55 million barrels between January and June 2025. However, with local supply proving insufficient, the refinery is turning to foreign sources to meet its daily refining needs.
In response to this, the Dangote Refinery is constructing eight additional crude storage tanks, increasing its capacity by 41.67%, bringing total storage to 3.4 billion liters. This expansion is part of the refinery’s broader strategy to build a larger stockpile of imported crude.
Devakumar Edwin, Vice President of Oil and Gas at Dangote Industries, explained that importing crude instead of relying solely on local supplies necessitates higher stockpiles. “Importing crude from other countries means that our crude stockpiles will have to be higher,” he said.
In a further indication of the refinery’s reliance on external sources, the facility issued a term tender in May 2024 for the purchase of two million barrels of West Texas Intermediate Midland crude per month for 12 months. This amounted to 24 million barrels of crude in just one year, highlighting the refinery’s increasing dependence on global markets to fuel its operations.
With the Dangote Refinery already supplying petrol, diesel, and aviation fuel both domestically and to other countries, this growing import dependency underscores the challenges facing Nigeria’s oil and gas sector and its refining capacity.
As the Dangote Refinery prepares for its full-scale operations in 2025, the reliance on US crude and expansion of storage capabilities reflects a broader shift in the refinery’s strategy, aiming to mitigate the risk of local supply shortages while securing a stable feedstock supply from international markets.
