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Dangote Refinery to Purchase 24 Million Barrels of US Crude – bloomberg

Dangote Refinery to buy 24m Barrels of US Crude - bloomberg

The Dangote Refinery plans to procure 24 million barrels of crude oil from the United States over the coming year as it ramps up its processing capabilities. According to a report by Bloomberg on Thursday, the refinery has issued a “term tender” for the monthly purchase of two million barrels of West Texas Intermediate (WTI) Midland crude, starting in July and continuing for 12 months.

The tender, detailed in a document cited by Bloomberg, will close on May 21. This strategic move underscores the refinery’s growing influence in global crude and fuel markets. It also highlights Nigeria’s ongoing struggle to boost its own crude production, which remains significantly below its potential capacity. The Dangote Refinery is opting for more cost-effective foreign supplies over domestic crude.

Nigeria, a member of the Organization of Petroleum Exporting Countries (OPEC), has consistently fallen short of its production quotas. In April, the country produced approximately 1.45 million barrels per day (bpd) of crude oil and condensates, far below its estimated capacity of 2.6 million bpd. Factors contributing to this shortfall include crude theft, ageing infrastructure, reduced investments, and divestments by major oil companies operating in Nigeria.

Currently operating at about half capacity, the Dangote Refinery is capitalizing on the availability of cheaper US crude, with up to a third of its feedstock coming from these imports. Bloomberg reported that since the beginning of the year, the refinery has received at least one supertanker carrying around two million barrels of WTI Midland crude each month.

An official from Dangote declined to comment on the report. Meanwhile, on April 15, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) issued new draft regulations requiring oil producers to prioritize selling crude to domestic refineries before fulfilling international orders.

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