A report by the Financial Times Thursday stated that the 650,000 barrels of oil per day refinery plant currently being built by Dangote Group in Lagos, and set for inauguration in 2020, would likely produce more fuel than what Nigeria needs and send the dilapidated refineries of the Nigerian National Petroleum Corporation (NNPC) packing.
On Dangote’s oil refinery, it explained that its emergence could change the country’s energy balance and effectively send the three refineries run by the Nigerian National Petroleum Corporation (NNPC) in Warri, Port Harcourt, and Kaduna, to their natural deaths because there would not be any need for them on the back of the 650,000 barrels a day capacity production, which would be more than what Nigeria needs.
It explained that the refinery would equally have a fiscal impact on Nigeria’s economy considering that there could be a reduction in the demand for foreign exchange to import petrol which is subsidised.
According to it, experts noted that Dangote may not sell petrol at the subsidised price of N145 per litre when the refinery comes on stream, and that Nigeria would have to scrap the subsidy, which is quoted to cost her $7 billion annually to maintain and demands about 40 per cent of her foreign exchange, because it would be cheaper for her to source fuel from the Dangote refinery.
