Nigeria Must Boost Oil Production to Become Petroleum Product Exporter, Says Dangote

By Utebor Paul, Nigeria

Alhaji Aliko Dangote, Chairman of Dangote Refinery and Petrochemicals, has stressed the need for Nigeria to enhance its crude oil production and effectively manage its supply to local refineries. This, he said, is essential for transitioning from a net importer to a net exporter of petroleum products.

Dangote made this statement in Lagos during a summit organized by the Crude Oil Refinery Owners Association of Nigeria (CORAN), where he was represented by Engr. Mansur Ahmed, Group Executive Director of Dangote Industries Limited.

In his keynote address, Dangote expressed concern over Africa’s dependence on imported petroleum products, despite producing over 3.4 million barrels of crude oil per day.

He revealed that Africa imports around 3 million barrels of petroleum products daily, primarily from Europe, Russia, and other regions, at a cost of approximately $17 billion in 2023.

He noted that Nigeria could capitalize on this by becoming a net exporter of refined petroleum products, as the country is strategically positioned to serve African markets more competitively due to shorter distances and lower logistics costs.

“It is worth noting that the Dangote Refinery already produces sufficient diesel and jet fuel to meet Nigeria’s demand. We recently started producing PMS and will soon ramp up to meet the nation’s needs,” Dangote said, adding that the refinery has already exported refined products to various international markets, including Europe, Brazil, the USA, and South Korea.

Dangote emphasized that to seize this opportunity, Nigeria must develop a refining capacity of 1.5 million barrels per day and prioritize domestic crude supply obligations.

He also urged the government to incentivize investors, noting that the Dangote Refinery was built without government incentives.

He criticized Africa’s spending of oil proceeds from the future, contrasting it with countries like Norway, which invest oil revenue in future funds.

Dangote further highlighted that Nigeria must expand crude oil production to meet the increasing demand from new refineries and praised President Bola Tinubu’s administration for fast-tracking international oil companies’ divestments and other initiatives aimed at boosting the country’s refining capacity.

“Global developments in the petroleum sector, especially in Europe, will disrupt historical trade flows for refined petroleum products in Africa. Nigeria is uniquely positioned to capitalize on this opportunity and become a significant player in the global oil industry,” he stated.

The summit, themed “Making Nigeria a Net Exporter of Petroleum Products,” underscored Nigeria’s potential as a refining hub. Dangote called for collaboration among stakeholders to ensure the country becomes a major exporter of refined products, thereby improving its balance of trade and generating foreign currency.

He concluded by reaffirming that the Dangote Petroleum Refinery and Petrochemicals is poised to transform Nigeria into a net exporter of refined petroleum products, which will strengthen Nigeria’s position in the global downstream market.