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June 2, 2023
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NNPC to supply 300,000 barrels of crude per day to Dangote refinery- Mele Kyari

Article Summary

  • Mele Kyari, CEO of Nigerian National Petroleum Company, announced that they will supply 300,000 barrels per day of crude oil to the Dangote refinery.
  • The government-owned refineries in Kaduna, Port Harcourt, and Warri are expected to be operational by 2024, reducing Nigeria’s reliance on imported refined products.
  • The Dangote refinery, set to be commissioned soon, will have significant production capacity and aims to satisfy Nigeria’s demand for refined goods while stimulating the development of other industries.

Mele Kyari, the Group Chief Executive Officer of the Nigerian National Petroleum Company has said that the company will supply 300,000 barrels per day of crude to the 650,000 barrels per day Dangote refinery.

Kyari said this during the just concluded 2023 Nigerian Oil and Gas Opportunity Fair (NOGOF), organized by the Nigerian Content Development and Monitoring Board (NCDMB), held in Yenagoa, Bayelsa State.

Kyari also said that the government owned refineries in Kaduna, Port Harcourt and Warri, will be open for business by 2024 at the latest. This is because the refineries are being rehabilitated with loans and they need to be put to work to pay back those loans.

The local refineries and the Dangote refinery, where NNPCL has a 20% stake, will reduce Nigeria’s dependence on refined products imports. According to Kyari, the Port Harcourt refinery will start production by December 2023 and the Warri and Kaduna refineries will start production in the first quarter of 2024. Kyari said:

  • “We want to address the energy challenges so that industrialization can come to the country. 48% of all revenue that comes to the government comes from the oil and gas sector, and we are in a perfect position to support the economy’s growth.
  • “Port Harcourt will start producing fuel this year, and by the first quarter of next year, Kaduna will start producing fuel.”

Tackling oil production decline

The fact that Nigeria produced only 998,602 barrels of crude oil per day in April 2023 is worrying, especially as NNPCL plans to supply crude to the Dangote refinery and the local refineries when they start working. However, during his speech at NOGOF, Kyari assured Nigerians that the challenges leading to production decline in April are being tackled. According to him, production has declined in the past few weeks due to some production challenges, but efforts are on-going to fix the issues.

More insights on Dangote refinery

On May 22, President Buhari will commission the Dangote refinery. Soon after, NNPCL will supply 300,000 bpd of crude for refining. Once the Dangote refinery is at full capacity, it can produce 57 million litres per day of gasoline, 27 million litres per day of diesel, 11 million litres per day of kerosene, and nine million litres per day of aviation jet fuel.

Recall that Nairametrics reported that the Dangote refinery is expected to satisfy Nigeria’s need for all refined goods and open an $11 billion market for local petroleum products, reducing the need for expensive imports and fuel subsidies while creating jobs and reducing illegal oil refining in the Niger Delta Basin.

Also, Dangote refinery’s production of critical products like naphtha and polypropylene will stimulate the development of other industries, such as cosmetics, plastics, and textiles.

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