Dangote Refinery to reduce Africa’s petroleum product imports by 36 percent – APPO

The refinery of Nigerian Billion, Aliko Dangote has been identified as one with capacity to save the African continent from the over reliance on the importation of petroleum products. According to the African Petroleum Producers Organisation (APPO), Dangote alone can reduce the alarming import figure by 36 per cent when the refinery becomes fully operational.

Dr. Omar Farouk Ibrahim, Secretary-General of APPO made these revelations in a recent interview. “To appreciate the impact that the Dangote refinery is going to have on African economies and especially on the supply of petroleum products, and to some extent the conservation of scarce foreign exchange, a look at some statistics on the continent’s petroleum products demand and supply is in order”

He added that, “currently, Africa’s daily petroleum demand is 4.3 million barrels per day (mbd). Of this volume, 57 per cent is produced locally (on the continent) while 43 per cent is imported. When Dangote is fully operational, the percentage of Africa’s products imported shall drop to 36 per cent. This is even as the total volume of products demand rises to 5.4 mbd.”

He further stated that, “you can therefore see the huge impact that Dangote refinery shall be made to overall products supply in Africa. Dangote shall be supplying over 12 per cent of Africa’s products demand.

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“That is huge savings for a continent that has scarce foreign exchange and little to export. We shall save from buying abroad and from shipping and insurance costs. Furthermore, the success of Dangote could incentivise the rise of similar projects, the noise about energy transition notwithstanding,” he said.

Ibrahim equally noted how relevant the refinery will be to Africa, especially in the age of energy transition across the west. According to him, many of the countries where Africa sources its petroleum products from are gradually moving away from fossil fuel and may not be able to supply the continent any longer.

He sees this as a strength for Dangote due to the fact that, African countries will still need petroleum products as they work towards their transition, which may take some time compared to the advanced countries.

The 650,000 bpd facility is located at Lekki Free Zone- Lagos. It covers a land area of 6,180 acres. The entire project was estimated to cost $15billion, with $10billion invested in the refinery, $2.5billion in fertilizer factory and the remaining $2.5billion in pipeline infrastructure for oil transportation.

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