Video: Aliko Dangote Launches Africa’s Biggest Oil Refinery In Bid To End Fuel Imports
Nigeria’s new Dangote petroleum refinery is Africa’s biggest – it will produce 650,000 barrels a day, giving it the potential to address the country’s energy supply crisis.
Owned by Nigerian industrialist and Africa’s richest man, Aliko Dangote, the refinery is expected to boost domestic refining capacity, getting rid of the current consumption shortfall. It will also reduce import dependency and stimulate economic growth.
It is the first privately owned crude oil refinery in Nigeria. Nigeria’s existing refineries, plagued by operational inefficiencies under government control, have failed to meet the growing demand for petroleum products. Substantial imports have become necessary.
Nigeria currently imports more than 80% of its refined petroleum products. The country is the largest importer of refined petroleum products in Africa. Local production will therefore massively cut the country’s import bill.
In 2020, Nigeria spent US$7.78 billion on importing refined petroleum products. In 2021 the value of these imports rose by 45% to US$11.3 billion.
According to the new corporate entity solely licensed to operate Nigeria’s petroleum industry, NNPC Limited, Nigeria spent $10 billion on fuel subsidies in 2022 and is expected to spend $7.5 billion on fuel subsidies by mid-2023. This represents about 24% of Nigeria’s 2022 budget and is an unsustainable drag on public finances.
Source: The Conversation
