S&P Global, an international financial analytics firm, has praised the Dangote Oil Refinery and Petrochemicals company, stating it could resolve Nigeria’s foreign exchange (forex) challenges and ease the pressure on the Naira.
The refinery, capable of processing 650,000 barrels per day (bpd), is also expected to boost Nigeria’s economic development.
During an onsite visit to the Dangote Refinery in Ibeju-Lekki, Lagos, S&P Global officials, accompanied by representatives from the Federal Ministry of Finance, assessed the refinery as part of Nigeria’s sovereign credit ratings review.
Ravi Bhatia, Director and Lead Analyst of Sovereign and International Public Finance Ratings at S&P Global, led the delegation. He remarked, “It is a very impressive facility, able to process 650,000 barrels a day when in full capacity. Nigeria is a big exporter of crude but has issues with importing refined fuels. This refinery can bridge that gap, saving money and foreign exchange, and positively impacting the economy in the medium term.”
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Devakumar Edwin, Vice President of Oil and Gas at Dangote Industries Limited, reiterated the refinery’s potential to transform Nigeria into a net exporter of petroleum products. He said, “By harnessing Africa’s abundant crude oil resources to produce refined products locally, we aim to catalyze industrial development, job creation, and economic prosperity.”
Edwin announced that the refinery would begin producing premium motor spirit (PMS) in July, and can meet 100% of Nigeria’s demand for petrol, diesel, kerosene, and aviation jet fuel, with surplus for export. He added, “The refinery can produce the best quality products in the world, Euro V grade. It is highly energy-efficient and environmentally friendly.”
Currently operating at 350,000 bpd, the refinery plans to increase to at least 500,000 bpd by July/August. Edwin emphasized that the refinery, which processes various crudes from Africa, the Middle East, and the US, conforms to international emission and quality standards.
The S&P Global team commended Aliko Dangote, President of Dangote Industries Limited, for incorporating advanced technologies and quality control measures at the refinery. The team included Maxmillian McGraw, Associate Director of Sovereign Ratings; Omegu Collocott, Director of Corporate Ratings; Charlotte Masvongo, Senior Analyst of Bank Ratings; and Samira Mensah, Director of Financial Services.
Nigeria, a leading oil producer, exports crude oil for refining and imports refined products due to non-operational local refineries. According to the National Bureau of Statistics, Nigeria spent approximately N12 trillion on petroleum imports in 2023, an 18.68% increase from the previous year. The Dangote Refinery is poised to reduce this dependence, benefiting Nigeria’s economy and forex reserves.