NNPCL Set to Fuel Dangote Refinery by December 2023 – Report

Infostride News has learned that the Nigerian National Petroleum Company Limited (NNPCL) is set to initiate a significant partnership with the Dangote Refinery, marking a significant development in the country’s oil industry. According to a report by Reuters published on November 2, 2023, NNPCL is planning to supply crude oil to the Dangote Refinery starting in December 2023.

The report provides insights into the nature of this collaboration, citing information from sources within NNPCL and Dangote Refinery. NNPCL intends to deliver up to six shipments of crude oil to the Dangote Refinery, totaling 200,000 barrels per day, as part of a one-year agreement. These shipments are scheduled for testing purposes and are expected to commence in December.

The volume of crude oil supply in the subsequent months will be determined through mutual consent and based on availability. This flexible arrangement ensures that both parties can adapt to changing circumstances and needs.

While specific details regarding the supply agreement have not been disclosed due to confidentiality clauses, it’s clear that this collaboration is a significant step forward in the relationship between NNPCL and the Dangote Group, which owns the Dangote Refinery.

This development comes after earlier reports indicated that the Dangote Refinery had faced delays in its operations, particularly with regards to meeting the refining deadline for diesel and aviation fuel. These delays were attributed to issues with crude oil deliveries, a factor that has now been addressed with the NNPCL’s commitment to supply.

A source quoted by Infostride News refutes the suggestion that Mr. Devakumar Edwin, the CEO of the Dangote Group, provided false information about the refinery’s operational timeline in September 2023. Instead, the source acknowledges that challenges in crude oil deliveries caused delays but reassures that the refinery is actively working to overcome these challenges and will soon commence refining activities.

The decision by NNPCL to supply crude oil to the Dangote Refinery underscores the readiness of the refinery to initiate its refining activities. Notably, the NNPCL holds a 20% stake in the Dangote Refinery, further solidifying their commitment to the project.

Mele Kyari, the Group Chief Executive Officer of NNPCL, has emphasized that the company’s equity participation in the refinery aligns with their goals of enhancing national energy security and fiscal stability. This move is in line with a government directive that mandates the Corporation’s involvement in any privately owned refinery with a capacity exceeding 50,000 barrels per day.

The Dangote Refinery, with its impressive capacity of 650,000 barrels per day, holds great promise for the future of the Nigerian oil industry. The International Energy Agency (IEA) has highlighted that the refinery has the potential to drive oil demand growth in the coming decade, particularly for African countries that currently heavily rely on imported refined energy products. This partnership between NNPCL and the Dangote Refinery not only benefits the two entities involved but also carries significant implications for the energy landscape in Africa.

In conclusion, the collaboration between NNPCL and the Dangote Refinery is set to have a transformative impact on the Nigerian oil industry. As NNPCL prepares to supply crude oil to the refinery, this partnership promises to boost the refinery’s operational capacity and contribute to national energy security and fiscal stability. With the potential to drive oil demand growth in the region, the Dangote Refinery is poised to become a crucial player in Africa’s energy landscape, benefiting countries that have traditionally relied on imported refined energy products. Infostride News will continue to monitor and report on developments in this important partnership.