The Nigerian National Petroleum Company Limited (NNPC) is expected to supply four crude cargoes from its February programme to the $20 billion Dangote refinery, Reuters reported on Tuesday.
The facility is poised to begin operations after years of construction delays, three sources with direct knowledge of the matter told the news agency.
The Dangote refinery, which will be Africa’s biggest refinery said it could begin test runs as early as this week, adding that it has received six initial crude cargoes.
A member of the Organisation of Petroleum Exporting Countries (OPEC), Nigeria currently relies on imports for most of the fuel it consumes, but the Dangote refinery is expected to make it self-sufficient and able to export fuel to neighbours in West Africa, potentially transforming oil trading in the Atlantic Basin.
Dangote received 1 million barrels of Nigeria’s Agbami crude on Monday, lifting total volumes received since December to 6 million barrels.
NNPC supplied the 650,000 barrel per day (bpd) plant with four of the cargoes, two of the sources said. A spokesperson for NNPC declined to comment, according to Reuters.
Dangote’s Group Executive Director for Strategy, Portfolio Development and Capital Projects, Edwin Devakumar, said the company did not request cargoes from NNPC for January.
“We are starting the refinery and if we continue to line up cargoes our inventory will build up as well as costs,” he said.
“If everything goes well, we will run for eight-10 days of operation, then we will begin to line up cargoes,” he added.
The refinery is also looking at crude supplies from other countries, he said without disclosing further detail.
One of the sources said that the refinery has nominated four NNPC cargoes for February.
A second source said that NNPC wanted to wait for the plant’s test runs before sending more oil.
Initial processing capacity is expected to reach 350,000 bpd, with the aim of ramping up to full capacity by the end of the year, Dangote said.
Designed for 100 per cent Nigerian crude with the flexibility to process other crudes, the refinery can process most African crude grades as well as Middle Eastern Arab Light and even US Light tight oil as well as crude from other countries.
Dangote Petroleum Refinery can meet 100 per cent of Nigeria’s requirement of all refined products, petrol, diesel, kerosene, and aviation jet, and also has a surplus of each of these products for export.
The refinery was built to take crude through its two Single Point Moorings (SPMs) located 25 kilometres from the shore and to discharge petroleum products through three separate SPMs. In addition, the refinery can load 2,900 trucks a day at its truck-loading gantries.
Dangote refinery has a self-sufficient marine facility with the ability to handle the largest vessel globally available. In addition, all products from the refinery will conform to Euro V specifications.
The refinery is designed to comply with US EPA, European emission norms, and Nigeria’s emission/effluent norms as well as African Refiners and Distribution Association (ARDA) standards.
“Once the 6 million barrels are fully delivered, it will facilitate the initial run of the refinery as well as kick-start the production of diesel, aviation fuel, and Liquefied Petroleum Gas (LPG) before subsequently progressing to the production of Premium Motor Spirit (PMS) or petrol,’’ the company said recently.
Emmanuel Addeh in Abuja
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