...
Nigeria's massive Dangote Refinery has made its first purchase of crude oil from the United States, signaling a historic diversification of its energy supply. Trafigura Group will deliver 2 million barrels of WTI Midland crude to the refinery by the end of February 2024, worth $20 billion.
This purchase indicates that the refinery is expanding beyond Nigerian crude, on which it has relied since beginning operations earlier this month. The refinery gains access to a reliable, high-quality source of energy by tapping into the booming US oil production.
Nigeria benefits greatly from the refinery's ability to process a wide range of crudes. Initially operating at 350,000 barrels per day, the facility intends to increase to its full capacity of 650,000 barrels. When fully operational, it will be able to meet 100% of Nigeria's gasoline, diesel, kerosene, and jet fuel requirements, with a surplus for export.
Nigeria's economy is heavily reliant on oil exports, so diversifying crude supplies is critical. Over the last decade, shale oil from the United States has gained traction in Asia and elsewhere. Dangote is currently utilizing this vast new resource.
Local effects are already noticeable. The refinery just started operations after receiving 6 million barrels of Nigerian crude. The US shipment will allow for increased production of fuels such as diesel, jet fuel, and liquefied petroleum gas.
Relieving Nigeria's fuel shortages would have far-reaching consequences for West Africa. The refinery is capable of processing most African crudes. It is the continent's largest single-train facility and marks a step toward energy independence. Dangote Refinery can help drive Nigeria's economy forward by importing US crude oil.
Add new comment