Dangote Refinery has purchased 5 million barrels of US crude oil, scheduled for delivery next month and in September, according to a report by Bloomberg on July 11.
The refining company has also initiated a tender process to buy an additional 6 million barrels of American crude for September.
This development came after the refinery purchased over 16 million barrels of West Texas Intermediate crude oil this year.
The report suggested that the proportion of US crude purchases may increase in August and September, according to tenders for new supply seen by Bloomberg.
“For Nigeria and Dangote, the use of US crude likely reflects where there are spare barrels available to buy in the world and the most competitive price,” the report reads.
“The refinery has been billed as a way of helping Nigeria wean itself off foreign fuel supplies. The refinery near Lagos mostly runs on local crude supplies that can reach the plant from offshore terminals in as little as a couple of days.”
Tracking data indicated that the refinery took in over 41 million barrels of feedstock in the first half of the year as it completed test runs and gradually raised processing rates. About a quarter of that has been American supply, according to Bloomberg.
With the latest purchase, the inflows of American feedstock may increase significantly. In May, the refinery planned a purchase of 24 million barrels of crude from the US for over a year.
This move is seen as a strategic step towards reducing Nigeria’s dependence on foreign fuel supplies and boosting local refining capacity. The Dangote Refinery, located near Lagos, is expected to play a significant role in achieving this goal.
Boluwatife Enome
Source:The cable
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