[divider style=”solid” top=”25″ bottom=”25″][dropcap]N[/dropcap]igeria’s 650,000 b/d Dangote refinery is undergoing test runs and should be fully ready for operations sometime in the second half of the year, company officials said.
“Mechanical work on the refinery is complete and hopefully before the end of third quarter we should be in the market,” the president of Dangote Group Aliko Dangote said at an event at the refinery Jan. 22. ”The plant will start with a processing capacity of 540,000 b/d. Full production can start maybe, by the end of the year or beginning of 2023.”
But on Jan. 24, a company official told S&P Global Platts that the official start-up will be dependent on how the test runs go.
Test runs are expected to end by the third quarter, after which production of refined products will fully kickstart.
“Barring any hitches during this period of the test-run of the units, the refinery will start refining crude into oil products by the fourth quarter of this year,” the official said Jan. 24.
Precommissioning of the production units and product export channels commenced last December 2021, after the successful launch of the products from the fertilizer plant constructed along with the refinery.
The startup date of this refinery has been repeatedly delayed, after the company first announced the project in 2013, due to a number of factors including funding challenges and later, the outbreak of the coronavirus pandemic that triggered lockdown measures at the construction site in Lagos.
Vital for Nigeria
This refinery is extremely critical for Nigeria, which relies heavily on fuel imports for its needs. The government has pinned its hopes of ending gasoline imports largely on the completion of the $13 billion refinery.
In August 2021, the Nigerian government, through the state-owned Nigerian National Petroleum Corp., announced that it was acquiring a 20% stake in the Dangote oil refinery project in a move to gain access to Africa’s largest refinery, and make the country less reliant on imports for its fuel needs.
NNPC is also expected to supply 300,000 b/d of crude to the 650,000 b/d refinery, as part of the deal.
Nigeria imports around 1 million-1.25 million mt/month of gasoline due to inadequate domestic refining capacity. The imports come at a huge cost in the form of government subsidies aimed at keeping domestic pump prices low. All its refineries, with a combined nameplate capacity to refine 445,000 b/d of crude oil, are currently shut down.
The plant’s crude distillation unit has been designed to process 12 crudes at one time and has been engineered to process three Nigerian crude grades — Escravos, Bonny Light and Forcados.
The Dangote plant, located on the outskirts of Nigeria’s commercial capital Lagos, will yield 327,000 b/d of gasoline, 244,000 b/d of gasoil/diesel, 56,000 b/d of jet fuel/kerosene, as well as 290,000 mt/year of propane/LPG when fully operational, according to a Dangote presentation given at an industry event last year.
It will also produce 830,000 mt/year of polypropylene, 600,000 mt/year of slurry, 290,000 mt/year of propane and 38,000 mt/year of sulfur.
Nigeria has been desperate to reform its downstream sector for almost a decade now, but progress has been slow.