Africa’s largest oil refinery commissioned in Lagos Nigeria

Nigeria’s President Muhammadu Buhari on Monday commissioned an oil plant billed as Africa’s largest oil refinery, after years of delays and per week earlier than stepping down from workplace.

Constructed by Africa’s richest particular person Aliko Dangote within the business hub of Lagos, the refinery ought to start operations in June with the primary merchandise anticipated in the marketplace by August although some analysts stated it might be later.

As soon as at full capability, it should have the power to course of 650,000 barrels a day, in keeping with the corporate.

Buhari — who steps down on Could 29 after eight years in workplace — described the undertaking as “a notable milestone” and “a recreation changer for the downstream petroleum merchandise market, not solely in Nigeria however for the whole African continent.”

The presidents of Ghana, Niger, Togo, Senegal and a consultant of the Chadian chief had been current on the commissioning.

The refinery is anticipated to fulfill Nigeria’s home demand in addition to serve international markets, Dangote stated.

“As soon as our plant is totally commissioned… we anticipate that at the least 40 % of the capability shall be obtainable for export, and this can end in important international change coming into the nation,” stated Dangote.

For many years, Africa’s most populous nation and one of many continent’s largest crude producers has trusted gasoline imports to fulfill native demand due to under-performing state-run refineries.

Nigeria swaps crude value billions of {dollars} for gasoline that it then subsidises for its home market.

It has prompted an enormous drain on international change at a time of dwindling oil income following the coronavirus pandemic and the Russia-Ukraine battle.

– Expensive subsidies –

For analyst Tunde Leye, from the Lagos-based SBM Intelligence consultancy, it was “necessary for Buhari to inaugurate (the plant) earlier than leaving energy” however he would not anticipate the refinery to be totally operational earlier than the tip of 2024.

Amaka Anku, Eurasia Group’s Africa head, was extra optimistic concerning the timeline.

“It usually takes six to 9 months to get to full operations,” she instructed AFP, which might be “by the tip of the yr or subsequent yr.”

She stated the “important” undertaking would even have a helpful affect on a variety of industries that want refined crude merchandise, from prescription drugs to building.

Each analysts famous nonetheless that Dangote’s refinery won’t make the worth of petroleum merchandise cheaper however may current a possibility for the federal government to take away expensive subsidies and tackle income shortages.

“I feel that this can be a important alternative for the federal government to assist its purpose of eradicating subsidies,” stated Anku, however “there is a political determination to be made.”

President-elect Bola Tinubu — whose February victory is being contested by the opposition — has stated that he would take away subsidies as soon as in workplace. He was not current on the commissioning.

The refinery may additionally assist enhance transparency within the oil sector, in keeping with Anku.

“Dangote is a publicly listed firm so will probably be publishing details about how a lot crude it’s buying and petroleum it’s promoting,” she stated, noting it as an enchancment in comparison with the present scenario the place “we do not have numerous transparency.”

The present opaque system has fostered corruption in keeping with analysts, and restricted the federal government’s skill to spend money on key areas like schooling and healthcare.

The brand new facility, mendacity on 2,635 hectares (6,500 acres) of land on the Lekki Free Zone, was initially estimated to value $9bn {dollars} however some $18.5bn has been spent to finish it, in keeping with the corporate.

Some 1,100 kilometres (about 680 miles) of subsea pipelines have been laid to hyperlink the oil-rich Niger Delta to the advanced.

The pipelines are additionally anticipated to create a hall for the evacuation of trapped fuel from offshore platforms and permit for the monetisation of the product.

Additionally on the large advanced is a $2 billion fertiliser plant with a 3 million tonnes each year capability.

Greater than 100,000 direct and oblique jobs are anticipated to be created via the undertaking, the Lagos State authorities has stated.

Further sources • AFP