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Dangote refinery begins temporary importation of crude oil

…To start receiving supply from NNPCL by November

The Executive Director, Dangote Group, Devakumar Edwin, has revealed that the Dangote Petroleum Refinery is currently importing crude oil and expects its first crude cargo in two weeks’ time.

Edwin on Monday, September 18, 2023, said the Nigerian National Petroleum Company Limited, NNPCL, had committed its crude to other entities. NNPCL is known for trading crude oil on behalf of Nigeria.

He did not disclose the other entities receiving the oil company’s crude but NNPCL in August 2023, disclosed it had entered into a $3 billion crude oil-for-loan deal with African Export-Import Bank, a deal which allows the company to pledge future oil production to the bank as repayments for the loan.

Also, NNPCL sources on Tuesday, September 19, said the company had entered into crude oil contracts with a number of entities, a development that made it impossible for the organisation to meet Dangote’s need earlier.

A top official of the oil company, however, made it known that plans were already underway to ensure Dangote’s refineries crude oil needs were met in November 2023.

Edwin pointed out that the importation of crude by Dangote refinery was temporary, as the firm would receive supply from NNPCL from November 2023.

He went ahead to reveal that the firm would begin the production of up to 370,000 barrels per day of crude that would give rise to Automotive Gas Oil, popularly called diesel, and jet fuel in October 2023.

The Dangote Group’s boss also said the plant would produce Premium Motor Spirit, popularly called petrol, by November 30, 2023.

This came as oil marketers stated that the prices of diesel and jet fuel would only crash when the Dangote refinery starts receiving crude oil from Nigeria, and not by importing crude.

Meanwhile, Edwin stated that the Dangote Refinery would initiate a gradual increase in petrol production, aiming to reach an impressive 650,000 barrels per day by November 30.

He emphasised the refinery’s readiness to receive crude oil, stating, “Right now, I’m ready to receive crude. We are just waiting for the first vessel. And so, as soon as it comes in, we can start.”

Regarding the shift in the original timeline, Edwin clarified that the NNPCL had already committed their crude oil to another entity on a forward basis, causing a temporary delay.

He said the setback was momentary, and the refinery would soon run exclusively on Nigerian crude oil as from November 2023.

SOURCE: thestreetjournal.org

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