The Dangote Refinery is set to halt crude oil imports by the end of 2025, transitioning fully to Nigerian crude as its primary source of feedstock. This development, reported by Bloomberg, marks a significant step in localizing the nation’s refining operations and reducing reliance on foreign oil.
According to Devakumar Edwin, Vice President of Dangote Industries overseeing the 650,000-barrel-per-day facility in Lagos, existing contracts with international crude suppliers are nearing expiration. As those agreements wind down, the refinery plans to source its crude entirely from domestic producers.
“We expect some of the long-term contracts will expire. Personally, and as a company, we expect that before the end of the year, we can transition 100 percent to local crude,” Edwin said.
In June, over half of the crude refined at the facility was sourced from Nigerian producers. This share is expected to rise steadily as local oil firms, whose international supply obligations are ending, redirect output to the refinery.
Despite efforts by the Nigerian government to prioritize domestic supply, local producers had initially resisted the enforcement of the Domestic Crude Supply Obligation, citing pipeline vandalism and crude theft in the Niger Delta as major setbacks. However, improved relations between the refinery, government agencies, and local traders have started yielding positive results.
The Dangote Refinery, valued at $20 billion, was established to eliminate the costly cycle of exporting unrefined Nigerian crude and importing finished petroleum products. It is currently processing around 550,000 barrels per day and is expected to reach its full capacity of 650,000 barrels once domestic supply stabilizes.
In July and August, the Nigerian National Petroleum Company Limited is slated to deliver five crude cargoes per month to the refinery, each carrying close to one million barrels.
Previously, the refinery relied heavily on imports from countries such as the United States, Brazil, Angola, Ghana, and Equatorial Guinea to keep operations steady during its ramp-up phase. In June, Bloomberg data showed the plant sourced 53% of its crude locally and 47% from the U.S.
Despite initial hurdles, the Dangote facility is already positioning Nigeria as a net exporter of refined petroleum products, a significant shift for a country long dependent on imports to meet domestic fuel demand.
