Dangote Refinery can solve Forex issue, catalyse Nigeria’s development: S&P Global

*S&P Global, an international financial analytics corporation, based in the United States, recently at Dangote Refinery, in Lagos, asserts the company is capable of resolving Nigeria’s Forex issue and catalysing national economic development, as Dangote reassures energy consumers of activating petrol production July 2024

Alexander Davis | ConsumerConnect

International financial analytics corporation, S&P Global, has described the 650,000 barrels per day (bpd) Dangote Oil Refinery and Petrochemicals company as capable of resolving Nigeria’s Foreign Exchange (Forex) issue and its huge pressure on the local Naira currency, while also catalysing the country’s economic development.

ConsumerConnect reports Dangote Group, which stated this Sunday, July 7, 2024, disclosed S&P Global, headquartered in Manhattan, New York City, United States (US), noted this during an onsite visit to the Dangote Refinery at Ibeju-Lekki, in Lagos, Nigeria, as part of its sovereign credit ratings assessment of the West African country.

The conglomerate said that members of the visiting S&P Global team were accompanied by officials from the Federal Ministry of Finance.

S&P noted that the largest single-train refinery complex in the world would bolster Nigeria’s oil sector and, more importantly, also have a positive impact on its growing economy.

Speaking after a four-hour tour of the Dangote Refinery, Ravi Bhatia, Director and Lead Analyst, Sovereign and International Public Finance Ratings at S&P Global Ratings, who led the delegation to Lagos, said Dangote Refinery would transform Nigeria into a net exporter of petroleum products.

Bhatia projected this transformation is expected to boost revenue generation and alleviate the current pressure on the country’s foreign exchange reserves.

He also stated: “It is a very impressive facility, able to process 650,000 barrels a day, when in full capacity.

“It is the largest single-train refinery complex in the world. It came out quite quickly. Nigeria is a big exporter of crude but has issues with importing refined fuels.”

The S&P Global Director and Lead Analyst said: “So, there is a gap in the market where crude can be refined in Nigeria, save money that way, and potentially save some foreign exchange.

“This will be positive for the economy in the medium term. It looks positive from our assessment.”

The S&P Global team, therefore, commended Aliko Dangote, President/Chief Executive of Dangote Industries Limited, on integrating advanced technologies and quality control measures, including a state-of-the-art Central Control Unit ensuring smooth automation of operations.

Other members of the team of the international rating agency include the Associate Director, Sovereign Ratings, Maxmillian McGraw; Director, Corporate Ratings, Omegu Collocott; Senior Analyst, Bank Ratings, Charlotte Masvongo, and Director, Financial Services, Samira Mensah.

Dangote Refinery will begin production of petrol July, says Edwin, Vice-President of Oil and Gas

Devakumar Edwin, Vice-President of Oil and Gas at Dangote Industries Limited (DIL), who led the team during the tour of the facility, told reporters that by harnessing Africa’s abundant crude oil resources to produce refined products locally, the company aims to catalyse a virtuous cycle of industrial development, job creation, and economic prosperity.

Edwin restated that as earlier promised, the company would begin the production of Premium Motor Spirit (PMS), otherwise known as petrol this month (July 2024).

According to him, products from the $20 billion facility are of high quality and meet international standards, and it can meet 100 percent of Nigeria’s demand for petrol, diesel, kerosene, and aviation Jet, with surpluses available for export.

Currently operating at 350,000 barrels per day capacity, Edwin said the refinery is slated to scale up to at least 500,000 barrels per day capacity by July/August, commencing the refining of petrol and ultra-low sulphur diesel.

Designed to process a wide range of crudes including various African and Middle Eastern crudes, as well as US Light Oil, the he affirmed the refinery conforms to Euro V specifications.

Besides, Dangote Oil Refinery is designed to comply with US EPA, European Union (EU) emission norms, the Department of Petroleum Resources (DPR) emission/effluent norms, and the African Refiners and Distribution Association (ARDA) standards.

Noting that most refineries were built by foreign companies, Edwin asserted that it is a thing of pride that a Nigerian company designed and built the world’s largest single-train refinery complex, while acting directly as its own Engineering, Procurement, and Construction (EPC) contractor.

The refinery also incorporates a self-sufficient marine facility capable of handling the world’s largest vessels.

The Vice-President of Oil and Gas at DIL further said: “The refinery can produce the best quality products in the world, Euro V grade. It is one of the energy-efficient refineries and it is highly environmentally friendly. It is sophisticated with a high level of automation.

“The largest single train refinery in the world is 100 per cent designed, engineered, and constructed by a Nigerian company as EPC contractor.”

Nigeria, one of the world’s leading oil-producing countries, exports all its crude oil for refining and subsequently imports refined products due to a lack of operational refineries.

It is estimated that Nigeria imports at least 50 million litres of petrol per day to meet domestic demand.

According to data from the National Bureau of Statistics (NBS), in its Foreign Trade Statistics for the Fourth Quarter (Q4) of 2023, Nigeria spent approximately N12 trillion on the importation of petroleum products in 2023, including premium motor spirit (PMS), commonly known as petrol. This figure marks an 18.68 percent increase compared to the N10 trillion spent on fuel imports in 2022.