In a significant development for Nigeria’s energy landscape, sources close to the matter have revealed that the Dangote Refinery is gearing up to supply Premium Motor Spirit (PMS), commonly referred to as petrol, to marketers starting in May 2024. This eagerly awaited move comes as Africa’s largest refinery, located near Lagos, initiates the distribution of diesel and aviation jet fuel to domestic marketers, potentially reshaping the country’s fuel market dynamics.
Recent reports from Nairametrics have highlighted the commencement of diesel and aviation jet fuel distribution by the Dangote Refinery to domestic marketers at a rate of 1,225 naira per liter. This development, which began earlier this week, is expected to have ripple effects on retail prices in the coming months, offering a glimmer of hope for consumers amidst economic uncertainties.
According to a Bloomberg report, the forthcoming inclusion of PMS supply from the Dangote Refinery is poised to significantly diminish Nigeria’s reliance on imported petroleum products. With operations commencing in January and the refinery’s maiden export of fuel oil and naphtha last month, the facility is steadily establishing itself as a pivotal player in the region’s energy sector.
Operating at an initial processing rate of 350,000 barrels per day, the refinery is on track to reach its maximum capacity in the near future. Abubakar Maigandi, a prominent figure within the industry organization, has confirmed that marketers have already begun transporting diesel from the refinery, marking a crucial step towards achieving self-sufficiency in fuel production.
However, while the groundwork for petrol supply is being laid, the specifics regarding volumes and pricing are still being finalized. Maigandi emphasized that discussions are ongoing to determine the optimal arrangements between the refinery and marketers, ensuring a smooth transition into this new phase of operations.
In a related development, Devakumar Edwin, an executive at Dangote Group, reaffirmed the company’s commitment to local distribution, citing substantial quantities of fuel available for evacuation via sea and road. The efficient transportation of products, facilitated by strategic vessel selection, underscores the refinery’s dedication to meeting domestic demand efficiently.
The Dangote refinery project, spearheaded by Africa’s wealthiest individual, Aliko Dangote, represents a monumental investment in Nigeria’s energy infrastructure. With a processing potential of 650,000 barrels per day, the refinery is poised to become the largest in both Africa and Europe upon reaching full operational capacity.
As Nigeria moves closer to achieving self-sufficiency in petroleum products, the impending rollout of PMS supply by the Dangote Refinery marks a significant milestone in the country’s energy transition. With consumers eagerly anticipating potential reductions in fuel prices and increased availability, the refinery’s impact on the nation’s economy and energy security cannot be overstated.
Credit: Nairametrics (Text Excluding Headline)
