A report from SP Global Commodity Insights indicates that the refinery's aviation fuel produced in Nigeria has made its way to key destinations such as Heathrow Airport in the UK, as the facility continues to enhance its production capabilities.
The report also notes that from January to October this year, a significant portion of the refinery's output has been sent to the Lome transshipment hub near Togo.
South Korea has emerged as the largest single export market, receiving 23,000 barrels per day (b/d) of naphtha.
Moreover, substantial quantities of gasoil have been shipped to Ghana and other West African countries from the $20 billion refinery.
Projections suggest that at least eight African nations are preparing to import products from the Dangote Refinery once it reaches full operational capacity next year.
SP Global highlights that the refinery's activities have already established Nigeria as a net exporter of jet fuel, naphtha, and fuel oil.
Commodity Insights forecasts indicate that Nigeria could export nearly 50,000 b/d more gasoil from Lagos than it imports by next year, with expectations for volumes to nearly triple by 2026.
Initially, the Dangote Refinery was not anticipated to export significant amounts of petrol, as its primary goal was to reduce Nigeria's dependence on fuel imports. However, in light of ongoing high fuel prices in Nigeria, the company is reportedly considering export opportunities.
According to the report, Nigeria's state oil company, NNPC, had previously depended on imports to satisfy around 350,000 barrels per day (b/d) of the country's petrol needs. Nevertheless, in November, NNPC announced its intention to source supplies exclusively from domestic refineries.
Despite this transition, Dangote is expected to produce only about 50,000 b/d of petrol as its residue fluid catalytic cracking unit increases its output.
The refinery has reached an agreement to export 200,000 metric tons (mt) of petrol, a situation that experts caution may lead to a domestic political crisis and increase pressure on global refining margins. Additionally, the enhancement of fuel quality by Dangote has led Nigeria’s fuel regulator to limit access to low-cost, substandard imports. With these improvements in standards, the government has also stopped protecting consumers from rising prices, as noted by SP Global.
Furthermore, the Nigerian National Petroleum Corporation (NNPC) Limited has faced challenges in managing import costs, revealing an accumulated debt of $6 billion.
According to data from S&P Global Commodities at Sea, the elimination of subsidies in May 2023 resulted in a more than 40% year-on-year decrease in petrol imports, a reduction that is partly linked to a decline in fuel smuggling activities. Looking at the international market, Dangote’s efforts to find petrol buyers are expected to further contribute to the downturn in global refining margins. Projections from Commodity Insights suggest that petrol margins in Northwest Europe may decrease from over $20 per barrel in early 2024 to around $7 per barrel by the first quarter of 2025.
A recent report highlights that jet fuel produced by the Dangote Refinery in Lagos now holds nearly two-thirds of Nigeria's market share.
According to data from Energy Intelligence, a US-based organization that tracks oil and gas trends, the refinery, which has a capacity of 650,000 barrels per day (bpd), has notably decreased Nigeria's dependence on imported aviation fuel and has led to a price reduction of approximately $2 to $3 per metric ton.
Foluso Sobanjo, Managing Director of Asharami Synergy, stated in an interview with Energy Intelligence, "We’re already purchasing from Dangote; it’s either slightly cheaper or comparable to import prices."
Energy Intelligence estimates that Dangote's jet fuel now accounts for at least two-thirds of Nigeria's market and nearly half of the total consumption in West Africa. The report indicates a significant drop in Nigeria's jet fuel imports, which fell from 13,000 barrels per day (b/d) in 2023—when imports satisfied all domestic needs—to just 5,000 b/d in 2024.