Nigeria’s prominent Dangote oil refinery has reportedly been reselling cargoes of U.S. and Nigerian crude, according to four trade sources on Friday.
Three of these sources cited technical problems at the refinery as the reason for the reoffer. When questioned about the offers and market rumors of operational issues affecting the crude distillation unit (CDU), a Dangote executive confirmed that the CDU was operational, Reuters reported.
The Dangote refinery, which began production in January, is set to become the largest in Africa and Europe once it reaches full capacity.
This development could disrupt the $17 billion annual Europe-to-Africa fuel trade and transform Nigeria into a fuel exporter.
Sources have reported that cargoes of Nigerian Escravos and Forcados crude, as well as U.S. WTI Midland crude, are among the grades being offered.
The plant has been importing several crude cargoes a month, traders said, adding that such resale by refineries is rare but not unheard of.
Dangote Group’s Response
In a statement addressing the claim, Anthony Chiejina, chief branding and communication officer of Dangote Group, said the report was incorrect.
“Our attention has been drawn to a misleading report on our crude distillation unit and also that we are offering crude for resale,” Chiejina said.
“This is outright falsehood as we are not authorized to sell any crude we buy from Nigeria! Also, our CDU is working and in perfect condition.”
“We advise that you ignore these false narratives being peddled by those bent on the importation of dirty fuels into the country.”
Background and Ongoing Dispute
This development comes amid a dispute between Aliko Dangote, chairman of Dangote Industries Limited, and officials from the Nigerian National Petroleum Company (NNPC) Limited.
The $20 billion, 650,000 barrel-per-day Dangote refinery, built by Africa’s richest man Aliko Dangote, aims to reverse Nigeria’s reliance on fuel imports despite being Africa’s biggest oil producer.
