Dangote refinery begins gasoline sales to Nigeria’s domestic market
Nigeria’s 650,000 b/d Dangote refinery has begun selling gasoline domestically, with state-owned NNPC as the sole buyer. NNPC is paying Dangote in US dollars for September gasoline deliveries, with a crude-for-gasoline swap starting in October to be settled in naira.
The refinery’s ex-refinery price for gasoline is set at $736/t, or 898.78 naira/litre ($0.55/l), with a retail price of N950.22/l in Lagos, reflecting recent price hikes due to reduced government subsidies. Gasoline pricing is negotiated directly between parties under Nigeria’s Petroleum Industry Act.
NNPC has relied heavily on imports for domestic gasoline supply but hopes Dangote’s operations will reduce this dependence. While the refinery aims to meet domestic demand, it is still ramping up production, supplying 16mn litres over the weekend, far below its full capacity of 57mn l/d.
Full operations are expected by October or November once the residual fluid catalytic cracker (RFCC) becomes fully functional. NNPC will supply Dangote with 385,000 b/d of crude starting in October, with gasoline sold exclusively to NNPC for domestic distribution. Diesel will be available to other buyers.
By Afolake Oyinloye
