Ghana could buy petroleum products from Nigeria’s Dangote Oil Refinery once the facility operates at full capacity, reducing the need for more expensive imports from Europe.
The head of the country’s oil regulator, Mustapha Abdul-Hamid, said this on Monday, according to a report by Reuters.
Abdul-Hamid, chairman of the National Petroleum Authority, stated at the OTL Africa Downstream Oil Conference in Lagos that this shift could eliminate the $400 million Ghana spends monthly on fuel imports from Europe.
He explained that importing from Nigeria would help lower the prices of goods and services by cutting freight costs.
“If the refinery reaches 650,000 bpd a day capacity, all that volume cannot be consumed by Nigeria alone, so instead of us importing as we do right now from Rotterdam, it will be much easier for us to import from Nigeria and I believe that will bring down our prices,” Hamid said.
He also noted that African countries may eventually adopt a common currency, which would ease the demand for dollars.
Backstory
Nairametrics previously reported that the Dangote Oil Refinery will supply petroleum products to other West African countries and the Caribbean once it begins operating at full capacity.
- Aliko Dangote, the CEO of the refinery, stated in May that it will produce refined products such as petrol, diesel, and aviation fuel not only for the Nigerian market but also for export across Africa once the facility reaches full operation.
- Speaking at the Africa CEO Forum in Kigali, Rwanda, Dangote highlighted that the 650,000 barrels per day (bpd) refinery is capable of meeting local demand while also supplying refined products to other African countries.
- Africa’s richest man noted that the refinery will ensure adequate supplies of gasoline, diesel, and aviation fuel for the African continent and export markets, including Brazil.
“We started producing jet fuel, we are producing diesel, by next month, we’ll be producing gasoline. What that will do, it will be able to take most African crudes.
“Our capacity is too big for Nigeria. It will be able to supply West Africa, Central Africa and also Southern Africa,” Dangote told the panel.
What you should know
The Dangote refinery was completed by Africa’s wealthiest individual, Aliko Dangote, with an investment of $20 billion.
- The refinery, with a processing potential of 650,000 barrels per day, is the biggest in both Africa and Europe upon achieving full operational status, which is expected either this year or next.
- The Dangote refinery is expected to significantly reduce Nigeria’s dependence on imported petroleum products.
- Nigeria, despite being the most populous country in Africa and its top oil producer, ironically imports almost all of its fuel.
Primarily, this is attributed to the nation’s lack of sufficient refining infrastructure, a gap that the new refinery seeks to fill.