Nigerian refineries, including the Dangote Refinery, have raised their domestic crude oil requirements for the second half of 2024 to 597,700 barrels per day (bpd), up from 483,000 bpd in the first half, according to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
This increase in demand comes despite limited domestic supply. The NUPRC reported that it secured only 177,777 bpd from oil producers during the first half of the year, far below the refiners’ requests.
The widening gap between the refiners’ rising crude needs and the supply constraints has led to tensions between the Dangote Refinery and the national regulator.
The Dangote Refinery, Africa’s largest, has criticized the NUPRC for not enforcing laws that require oil producers to prioritize supplying domestic refineries.
The refinery argues that the lack of enforcement is driving up its operational costs, forcing it to rely more on crude imports, which could undermine its goals for the year and long-term viability.
In response, the NUPRC acknowledged that oil producers are struggling to meet the refinery’s demands due to operational challenges.
The regulator also highlighted that forcing producers to increase supply to domestic refiners could violate existing contracts.
Looking ahead, the NUPRC projects that national crude oil production will average 1.7 million bpd by December 2024, an increase from the 1.57 million bpd projected for the first half of the year—a target that was not met.
Gbenga Komolafe, head of the NUPRC, emphasized that understanding these projections is crucial for assessing Nigeria’s energy landscape for the latter half of 2024.
He also noted that eight refineries are expected to become operational starting in August, with a combined refining capacity of 864,500 bpd.
Supplying over half of this capacity will require contributions from 52 oil producers, including major companies like TotalEnergies, Chevron, Shell, and ExxonMobil, primarily through their joint ventures with Nigeria’s state oil company, the NNPCL.
