The Dangote Refinery is set to supply Premium Motor Spirit (PMS), commonly known as petrol, to marketers starting in May 2024, according to sources familiar with the matter.
The largest refinery in Africa began distributing diesel and aviation jet fuel to domestic marketers at N1,225 per litre, a move that could potentially reduce the retail price of both products in the coming months.
A Bloomberg report indicates that the new mega-refinery will commence the supply of PMS in the domestic market in May, significantly reducing Nigeria’s dependence on imported petroleum products. The refinery, which commenced operations in January, recently made its first export, shipping 65,000 metric tons of low-sulfur straight run fuel oil and approximately 60,000 tons of naphtha last month.
Operating at an initial processing rate of 350,000 barrels per day, the facility plans to increase towards its maximum capacity. Abubakar Maigandi, the leader of an industry organization, confirmed that marketers have begun transporting diesel from the refinery and will make payments in naira.
“We are still finalizing the details of the volumes that we are going to take from Dangote as an association and we also haven’t finalized on the price,” he said.
READ ALSO: Dangote Cement Proposes 50% Increase in Dividend Payout to Shareholders
In related news, Abubakar Maigandi, who heads the Independent Petroleum Marketers Association of Nigeria, reported to Reuters that domestic marketers established diesel’s cost at N1,225 per litre after concluding a collective purchase arrangement and adding their mark-up.
Devakumar Edwin, an executive at Dangote Group, confirmed that the company has initiated the local distribution of diesel and jet fuel, stating, “We have substantial quantities. Products are being evacuated both by sea and road. Ships are lining up one after another to load diesel and aviation jet fuel.”
READ ALSO: Major Nigerian Oil Marketers Enlist with Dangote Refinery for Product Distribution
The Dangote refinery, situated on a peninsula near Lagos’s commercial center, represents Africa’s largest refinery project, financed by Aliko Dangote with an investment of $20 billion.
With a processing potential of 650,000 barrels per day, the refinery is poised to be the largest in both Africa and Europe upon achieving full operational status, which is expected either this year or the following.