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How Nigeria Can Become A Net Exporter Of Petroleum Products – Dangote
Nigeria must enhance its crude oil production capacity and effectively manage its crude supply to ensure adequate feedstock for domestic refineries, in order to transit from a net importer to a net exporter of petroleum products.
The Chairman of Dangote Refinery and Petrochemicals Company Limited, Aliko Dangote, made this assertion during his keynote address at a summit held in Lagos by the Crude Oil Refinery Owners Association of Nigeria (CORAN).
The event had top government officials, key stakeholders from the midstream and downstream sectors in attendance.
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On Nigeria’s potential as a refining hub, Dangote expressed concern that, despite producing over 3.4 million barrels of crude oil per day, Africa was importing around 3 million barrels of petroleum products daily.
He noted that these imports, primarily from Europe, Russia, and other regions, were estimated to cost approximately $17 billion as at 2023.
He opined that Nigeria could capitalise on this situation to become a net exporter of refined petroleum products, as the markets, particularly Africa, would be more competitively served from Nigeria.
In his words, “Both the crude oil and the petroleum products will travel shorter distances. The logistics costs of floating storage will be eliminated, and countries can purchase their petroleum product requirements just-in-time.
“Nigeria and Africa can become completely self-sufficient, and we can keep all the value on our shores. We have done it in cement, and we can certainly do it for petroleum products.
“It is worth noting that the Dangote Refinery already produces sufficient diesel and jet fuel to meet Nigeria’s demand. We recently started the production of PMS and will soon ramp up to meet Nigeria’s needs.
“Our refined products have been exported to diverse markets, including Europe, Brazil, the UK, the USA, Singapore, and South Korea.”
Represented by Engr. Mansur Ahmed, Group Executive Director of Dangote Industries Ltd, Dangote emphasised that Nigeria must develop a refining capacity of 1.5 million barrels per day and prioritise domestic crude supply obligations to seize this opportunity.
Acknowledging the arising and future challenges, he urged the government to incentivise investors, contrasting this with the Dangote Oil Refinery, which was built without any government incentives.
“. . . It is unfortunate that while countries like Norway are putting oil proceeds into a future fund, in Africa, we are spending oil proceeds from the future. We will also need to prioritise the implementation of domestic crude supply obligations. We will need to expand our crude oil production capacity to support demand from new refining capacity.
“The government of President Bola Ahmed Tinubu is taking active steps to achieve this through fast-tracking IOC divestments and other initiatives,” he stated.
Emphasising that global developments in the petroleum sector, particularly in Europe, will disrupt historical trade flows for refined petroleum products in Africa, Dangote stated that Nigeria is uniquely positioned to capitalise on this opportunity and become a significant player in the global oil industry.
To achieve this, Dangote called for consultation, collaboration, and cooperation among stakeholders.
“As a vibrant exporter of refined products, Nigeria will witness an improvement in its balance of trade and generate much-needed foreign currency. Nigeria’s potential as a refining hub is clearly not in doubt; let us work together to make it happen,” he urged.
The foremost industrialist noted that the summit’s theme, “Making Nigeria a Net Exporter of Petroleum Products,” would have seemed unrealistic a few years ago, and added that despite being Africa’s largest crude oil producer, Nigeria has historically relied on imports to meet its refined petroleum product needs.
However, he emphasised that the Dangote Petroleum Refinery and Petrochemicals is poised to transform Nigeria from a “net importer” to a “net exporter” of refined petroleum products, establishing the country as an emerging player in global downstream trade flows; with refined products already exported to various markets, including Europe, Brazil, the UK, the USA, Singapore, and South Korea.
Commending Dangote for this transformation, Chairman of IPPG/Waltersmith Refinery & Petrochemicals Co. Ltd, Abdulrazaq Isa, called on the government to support domestic refiners by ensuring the availability of crude, adhering to domestic crude supply obligations, and implementing effective pricing and monitoring measures to prevent smuggling.
On his part, Chairman of CORAN’s Board of Trustees and CEO of Integrated Oil & Gas, Captain Emmanuel Iheanacho (rtd), remarked that the Dangote Oil Refinery has set a high standard by producing Euro-V products, thus protecting citizens from exposure to high-sulphur products.
He noted that transforming Nigeria into a net exporter would bring numerous benefits but reiterated the need for increased investment to boost crude production, lamenting that Nigeria loses approximately $83 billion annually by not meeting its OPEC quota.
While acknowledging that tank farms remain essential despite local refining, Iheanacho urged the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), to consider cancelling import licences, because Nigeria can now meet her local demand.
Chairman of Major Energies Marketers Association of Nigeria (MEMAN), Huub Stokman, stated that Nigeria was on the verge of becoming Africa’s refining powerhouse, which would significantly boost the economy.
The Chairman of CORAN, Momoh Oyarekhua, also expressed concern over challenges related to crude supply and stated that domestic refiners will work with regulators and stakeholders to address these issues.
The Minister of State for Petroleum Resources (Oil), Senator Heineken Lopkobiri, assured that the government would continue to refine frameworks to enhance crude production and support domestic refineries.
His counterpart from the Ministry of Industry, Trade and Investment, Dr. Doris Uzoka-Anite, emphasised the Tinubu-led administration’s commitment to ensuring value addition for mineral resources before export.
Two panel sessions were held to discuss Nigeria’s downstream petroleum refining sector and its potential impacts, as well as policy strategies for achieving self-sufficiency in petroleum products.
The Central Bank of Nigeria (CBN) has announced a significant growth in the country’s economy, with a 3.46% increase in gross domestic product (GDP) in the third quarter of 2024.
This marks the third consecutive quarter of expansion, up from 3.19% in Q2 2024 and 2.54% in Q3 2023.
According to the newly published Q3 economic report, Nigeria’s GDP output rose to ₦20.115 trillion, reflecting a notable improvement from ₦18.285 trillion in the previous quarter.
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The CBN attributed this growth primarily to the performance of the non-oil sector, which grew by 3.37% compared to 2.80% in Q2 2024.
The report highlighted transportation, crop production, and other sub-sectors such as financial & insurance services, information & communication, trade, and real estate as major contributors to the expansion.
The non-oil sector accounted for 3.18 percentage points of the total growth rate.
“The expansion of the non-oil sector was driven by the performance of the financial & insurance, information & communication, crop production, trade, transportation & storage, and real estate sub-sectors,” the report stated.
Despite the economic growth, challenges persist. Inflation, particularly in food prices, remains a significant concern, standing at 39.93% as of November 2024.
Rising food and energy costs have also impacted transportation expenses, with intercity bus fares increasing by 20.23% year-on-year to ₦7,117.17 in July 2024, according to the National Bureau of Statistics.
Furthermore, the cost of petroleum, now exceeding ₦1,000 per litre, has driven up logistics and transportation expenses, adding pressure to households and businesses alike.
The CBN acknowledged these challenges, noting that the growth was achieved despite headwinds such as high inflation and rising operational costs.
Enhanced security measures in the Niger Delta have boosted domestic crude oil production, while restrictive monetary policies have helped moderate inflation in some areas.
“The growth recorded in the country is a result of continued efforts to improve the business environment, streamline cumbersome business processes, and deepen the quality of business infrastructure,” the CBN noted.
However, the report comes amid concerns over businesses exiting Nigeria due to persistent economic challenges.
Asharami Synergy, a leading downstream energy solutions provider, has demonstrated its commitment to community development and education by donating essential furniture to Gaskiya Junior School in Ijora, Lagos, Nigeria.
Biztellers reports that the social responsibility initiative was executed in collaboration with Sahara Group Foundation – the social impact vehicle of global energy conglomerate, Sahara Group.
It was gathered that the initiative is part of Asharami Synergy’s ongoing efforts to support education in communities.
The donation includes classroom desks and chairs for the JSS1 classes.
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CEO of Asharami Synergy, Nomnso Dike, said the project will create a more comfortable and functional learning environment and enhance student performance.
“We are delighted at the opportunity to support the attainment of Sustainable Development Goal (SDG) 4, which focuses on ensuring inclusive and equitable quality education. It has been a privilege to collaborate with the management and students of Gaskiya Junior School to deliver this project, and we look forward to future opportunities to enhance academic performance in this historic institution,” Dike said.
According to him, Asharami Synergy’s education-focused social impact initiatives have benefitted over 10,000 individuals. They focus on building capacity and providing the resources necessary to help students learn and grow sustainably.
“Education is the foundation of a brighter future, and at Asharami Synergy, we believe that every child deserves a learning environment that inspires and empowers them” he noted, adding, “This donation is not just about providing furniture; it’s a reminder to the students that their dreams are valid, and we are committed to helping them achieve their goals.”
Vice Principal Academic of Gaskiya Junior School, Sola Oladokun, commended Asharami Synergy for the donation, noting that it would inspire students to perform better with “increased concentration and fewer distractions”.
“These desks and chairs are a game-changer for our students. It’s heartwarming to see their excitement, and as teachers, we are equally thrilled because this will make teaching and learning more effective. We are incredibly grateful to Asharami Synergy and Sahara Group Foundation for this thoughtful intervention,” she added.
Two representatives of the students, Akin Moses and Chukwudi Gift, at the event said the donation would increase their “desire to dream bigger and concentrate better during lessons”.
Also speaking at the commissioning, COO at Asharami Synergy, Adekanmi Adesola, said, “What started as an opportunity to support the communities that host our operations has now come full circle. This donation directly impacts the lives of these students, and we are proud to bring smiles to the faces of the students and teachers.”
The Nigerian Content Development and Monitoring Board (NCDMB) has held the 8th Award and Prize-giving Ceremony of its Annual National Undergraduate Essay Competition 2024.
At the event, on Monday in Yenagoa, the NCDMB reiterated the objectives that underlie its signature events, such as competitive essaying and its twin programme the Science Quiz Competition for High School students.
In a keynote address at the occasion, the Executive Secretary of the Board, Engr. Felix Omatsola Ogbe, described the Essay Competition as “one of NCDMB’s multiple interventions to lift the standard of education in Nigeria” and “to promote proficiency in writing, awareness of local content and its benefit to the national economy, and to engender citizen engagement from undergraduate level.”
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According to him, the sponsorship of the competition is in line with the Board’s mandate, which is capacity-building and local content development, and that the NCDMB understood “the need to inculcate Local Content consciousness among undergraduates in our higher institutions, to make them understand that Local Content is an economic imperative for sustainable development of our local economy, creation of job opportunities and national security.”
The NCDMB boss expressed the hope that the programme would continue to generate interest and awareness about the critical importance of the Nigerian Content law and philosophy in the oil and gas sector as a national economic agenda for job creation, poverty reduction, industrial development and inclusive economic growth.
He reiterated the Board’s commitment to capacity development of Nigerians and development of opportunities for local communities as demonstrated through the Board’s recently launched “Back-to-the-Creeks Initiative.”
The Initiative seeks to broaden the contributions of the oil and gas industry to host communities through enhanced funding for local contractors, support for basic education, and training of youths in relevant industry skills.
In regard to the topic of this year’s essay competition, “Nigerian Content and Opportunities in African Local Content Advancement,” the Executive Secretary said it was well-conceived, considering that most African countries are understudying Nigeria in the implementation of Local Content.
Engr. Ogbe also expressed satisfaction with the transparent process in selecting the winners, stating that “the renowned professors who dedicated their time and intellect to this competition” lived up to the billing.
According to him, “We have built a strong and reputable brand and every project we get involved in must be excellent, professional and world-class.”
Earlier in a welcome address, the Chief Executive Officer of Mahogany 21st Century Concepts Limited, Mr. Eyinimi Omorozi, described the Annual Undergraduate Essay Competition as “a competitive elite programme” designed “to promote academic excellence and to raise awareness about Nigerian Content.”
He expressed appreciation to the Executive Secretary of the NCDMB, Engr. Ogbe, for ensuring sustenance of the programme for eight consecutive years.
In her own opening speech, the Chairperson of the occasion, Dr. (Mrs.) Alice Atuwo, represented by Mrs. A. Tawari, of the Bayelsa Education Trust Fund, commended the top ten finalists for their personal qualities that brought them thus far in the competition.
She urged undergraduate students to be focused on their studies and to guard against distractions that could be destructive.
The winner of the 2024 edition of the Essay Competition was a 16-year-old 200-Level student of the Federal University of Technology, Akure, Mr. Ojedele Jesuferanmi Emmanuel. He received a top-of-the-range HP laptop, a glass plaque, and a cash prize of N1 million.
The first runner-up was 23-year-old Miracle Chibuike Okoli. He received the same grade of HP laptop, a plaque and a sum of N700,000.
The second runner-up, 19-year-old Mary Okogbe, received N500,000, in addition to an HP laptop and a plaque.
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