Business and Economy

Dangote refinery is set to open

Dangote Industries Limited is preparing for a ceremonial inauguration this month at its Lekki Refinery in Lekki, Nigeria, which would be Africa’s largest refinery, after years of delays and regulatory challenges. The facility’s crude distillation unit (CDU) is expected to commence commercial operations by the end of June, according to the business. Industrial Info is tracking more than US$14 billion in active projects at the Lekki Refinery, which accounts for slightly less than half of all current refining projects in Nigeria.

Nigeria’s refining capacity will be increased to 3.24 million barrels per day (BBL/d) with the Lekki Refinery. Once operational, its single, 650,000-BBL/d CDU will be the largest in the world in terms of capacity. The largest is currently a 430,000-BBL/d CDU at the Yanbu Refinery in Saudi Arabia, which was completed in 2015.

Subscribers to Industrial Info’s Global Market Intelligence (GMI) Metals & Minerals project and plant databases can read more about the Lekki Refinery in a plant profile or click here for a list of detailed reports for projects at the site.

The Lekki Refinery’s commercial launch was delayed due to operational challenges at its power plant, which prevented its crude unit from working. However, the business now aims to start up the facility’s boilers and gas turbines by June, albeit its downstream facilities will not start up until later this year. Other units may not be operational until the end of 2024. The refinery’s output will be mostly gasoline, with some diesel and jet fuel thrown in for good measure.

The market is closely watching the start-up of this plant, particularly in terms of how much crude it will process,” said Hillary Stevenson, senior director of Energy Market Intelligence at IIR Energy. “Our research shows that the plant is expected to operate at 50% capacity until its downstream units are operational, which may not be until 2025.”

The Nigerian National Petroleum Company (NNPC), which bought a 20% share in the Lekki Refinery in 2021, intends to stop importing refined goods into the country by the end of this year. In August, NNPC CEO Mele Kyari told reporters that the African country’s planned output from Lekki and other state-owned refineries would “eliminate any importation of petroleum products into this country.

According to Kyari, NNPC also has the right to purchase 20% of the plant’s output.

The project is one of almost two dozen grassroots refineries being built throughout the world to compensate for pandemic-related refinery rationalizations and keep up with increased global fuel demand.

The 125,000-BBL/d Warri Refinery, one of NNPC’s own refineries, began a restoration and restart project in April that is slated to be completed in the first quarter of 2024. NNPC anticipates that the project will enhance nameplate capacity utilization at the Warri Refinery from 50% to 90%. A complete project report and plant profile are available to subscribers.

According to the Financial Post, Kyari stated that NNPC has committed sales of at least 330,000 BBL/d for the next 20 years.

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