Dangote Refinery imports crude from Equatorial Guinea, to dodge local sabotage of $20b facility
By Jeph Ajobaju, Chief Copy Editor
Dangote Refinery has bought its first cargo of Equatorial Guinea’s medium sweet, Ceiba crude, amid reports that the Nigerian National Petroleum Company Limited (NNPC) failed to deliver on its promise to supply adequate crude to Africa’s largest refinery in Lagos with 650,000 barrels per day (bpd) production capacity.
Argus Media quoted sources with knowledge of the matter as saying Dangote bought the 950,000 barrels of cargo over April 12-13 from BP in the past week. The price is being kept under wraps.
Argus reports that most Ceiba exports typically go to China. Around 18,000 barrels per day were discharged there last year, while three shipments went to Spain and one to The Netherlands, according to Vortexa data.
Two cargoes loaded in February and March this year are signalling Zhanjiang in China, per tracking data.
Traders reportedly noted that buying a Ceiba cargo is part of Dangote’s efforts to diversify its crude sources.
Last month, Dangote Refinery, a $20 billion facility, bought its first cargo of Algeria’s light sweet Saharan Blend crude from trading firm Glencore, due to be delivered between March 15 and 20, according to reporting by The PUNCH.
Market sources told Argus that Dangote seems to have sourced competitively priced crude from Equatorial Guinea at a time when domestic grades are facing sluggish demand from Nigeria’s core European market.
This comes amid ample supply of cheaper Kazakh-origin light sour CPC Blend, United States WTI, and Mediterranean sweet crudes.
Several European refineries are due to undergo maintenance in April, which is also weighing on demand.
The NNPC has said it is currently in negotiations with Dangote Refinery about extending their naira-for-crude arrangement, which involves crude prices being set in dollars and Dangote paying the naira equivalent.
“Any changes to the terms of the programme may pressure Dangote to increase the amount of foreign crude in its slate,” the report said.
Refinery sources told Argus in January that Dangote will source at least 50 per cent of its crude needs on the import market and is building eight storage tanks to facilitate this.
The founder of the refinery, Aliko Dangote, said last month that the refinery is planning to reach its full capacity in March.
However, crude shortage remains a challenge and this could prevent the facility from achieving its ramp-up plans.
NNPC spokesperson Olufemi Soneye disclosed some of details of the naira-for-crude deal in a recent statement.
“Under this arrangement, NNPC has made over 48 million barrels of crude oil available to Dangote Refinery since October 2024. In aggregate, NNPC has made over 84 million barrels of crude oil available to the refinery since its commencement of operations in 2023,” he said.
In that case, the NNPC supplies an average 300,000 barrels of crude per day to Dangote Refinery, but experts said to meet its 650,000 bpd production target, the refinery must look elsewhere for feedstock.
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