…”Everything in this plant by way of size is the first. It is the largest single-train refinery in the world. There is no single column which can process 650,000 barrels per day anywhere else” – Sanjay Gupta, CEO, Dangote Petroleum Refinery and Petrochemicals.
The commissioning of the Dangote Refinery, the world’s largest single-train refinery, Monday in Lagos marks a significant milestone in the history of Nigeria.
President Muhammadu Buhari and other dignitaries, both national and international across different sectors of the economy were present to grace the landmark event.
With the Nigerian government planning to remove the petrol subsidy later this year, the refinery’s inauguration comes with great expectations.
This article explores key insights into the refinery, its capacity, economic potential, and its impact on Nigeria’s energy security.
1. Capacity and Infrastructure
Situated in Ibeju-Lekki, Lagos, the Dangote Refinery covers an expansive land area of approximately 2,635 hectares, equivalent to seven times the size of Victoria Island.
It boasts a staggering capacity of 650,000 barrels per day, making it the largest single-train refinery globally.
The refinery’s pipeline infrastructure, spanning 1,100 kilometers, can handle 3 billion standard cubic feet of gas per day.
2. Compliance with International Standards
The refinery’s design adheres to global standards, including those set by the World Bank, the US Environmental Protection Agency (EPA), European emission norms, and the Department of Petroleum Resources (DPR).
This ensures environmentally friendly operations and compliance with emission and effluent regulations.
3. Fuel Self-Sufficiency and Export Potential
Dangote Petroleum Refinery is poised to meet 100% of Nigeria’s refined product requirements, including gasoline, diesel, kerosene, and aviation fuel.
It has a production capacity of 53 million liters per day of gasoline, 34 million liters per day of diesel, 10 million liters per day of kerosene, and 2 million liters per day of aviation fuel.
Moreover, the refinery is anticipated to have surplus production for export, generating foreign exchange earnings for the country.
4. Economic Implications
The Dangote Refinery’s impact on Nigeria’s economy is profound. Analysts estimate that it will create a market for approximately $1 billion worth of Nigerian crude annually, boosting foreign exchange earnings by $9.9 billion.
Furthermore, it is expected to save Nigeria up to $10 billion in foreign exchange through reduced fuel imports and generate an additional $10 billion in export revenue.
The refinery’s operation also has the potential to stimulate domestic crude oil production, contributing to increased GDP.
5. Job Creation and Skill Development
The completion of the Dangote Refinery will not only create direct and indirect employment opportunities but also foster skills transfer and technology acquisition.
The training of 900 young engineers, mechanical engineers trained in Italy, and process engineers trained by Honeywell/UOP showcases the commitment to empowerment and skill acquisition.
6. Financial Support and Stakeholders
The construction of the Dangote Refinery was made possible through financial backing from various sources.
Afreximbank played a significant role as the largest financer, while a consortium of local and international banks, led by Standard Chartered Bank, provided a syndicated loan facility of $3.3 billion.
Additionally, Nigeria’s Federal Executive Council acquired a 20% stake in the project through the Nigerian National Petroleum Corporation (NNPC). That stake is worth $2.76bn.
7. Non-Petroleum Product Output
Apart from petroleum products, the refinery will produce other essential commodities. These include Euro-V quality gasoline, diesel, jet fuel, kerosene, polypropylene, propane, sulfur, and carbon black feed.
The surplus production of these products creates export opportunities and strengthens Nigeria’s industrial capabilities.
8. Ending Fuel Importation
Projections indicate that Nigeria will significantly reduce and eventually cease importing refined fuel by mid-2023. With the Dangote Refinery’s capacity and the combination of other domestic refineries, the country aims to achieve self-sufficiency in fuel production, ensuring energy security and reducing the burden of import.
We believe these are facts Nigerians should keep in mind regarding the Dangote refinery.
