The production of gasoline at the Dangote refinery in Nigeria is a turning point in the country’s oil sector, opening up new prospects for fuel supply to the domestic market. With a capacity of 650,000 barrels per day, the Dangote refinery has started selling gasoline to the local market, marking a significant step in its ramp-up.
In a context where the Nigerian National Petroleum Corporation (NNPC) acts as the sole buyer of gasoline produced by the refinery, it is interesting to note that September deliveries are settled in dollars, while an oil-to-gasoline swap system, denominated in naira, will be put in place from October. This commercial dynamic between Dangote and NNPC shows the desire to reduce the country’s dependence on fuel imports.
The benchmark gasoline ex-refinery price is set at $736 per tonne, equivalent to N898.78 per litre (or $0.55), with a retail price of N950.22 per litre in Lagos. These rates reflect recent adjustments following the reduction in government subsidies. Under Nigeria’s Petroleum Industry Act, gasoline pricing is done through direct negotiations between stakeholders.
While the refinery aims to meet domestic demand for gasoline, its ramp-up is gradual, with current production at 16 million litres as of last weekend, well below its total capacity of 57 million litres per day. The refinery is expected to reach full production capacity by October or November, once the Residual Fluid Catalytic Converter (RFCC) is fully operational.
Starting in October, NNPC will supply Dangote with 385,000 barrels of oil per day, with exclusive rights to sell the gasoline produced for domestic distribution. Diesel will be available to other buyers, providing diversification of the refinery’s products.
This shift to more local production strengthens Nigeria’s energy security and paves the way for greater self-sufficiency in fuel supply. The Dangote Refinery therefore plays a vital role in the dynamics of the Nigerian oil market, offering promising prospects for the country’s energy future.