The Federal Government has said the Dangote refinery, despite its scale, cannot single-handedly satisfy Africa’s fuel demand, and has called for greater investment in Nigeria’s refining sector to position the country as a continental supply hub.
Speaking on Tuesday at the second West Africa Refined Fuel Market Conference in Abuja, the Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, said the Dangote refinery had proven what private-sector investment could achieve, but stressed that even as its output climbs toward 1.4 million barrels per day, that volume would still fall short of what the continent requires. He explained that this expanded capacity would mainly serve to open the way for intermediary buyers to distribute fuel across Africa and to markets beyond.
Lokpobiri encouraged investors with available capital to take advantage of Nigeria’s growing energy market, arguing that the country is well positioned geographically to serve both regional and international demand. He noted that Nigeria holds a further advantage in not relying on the Strait of Hormuz for its crude and refined product shipping routes, unlike many other oil-producing nations.
The minister said Nigeria needs to build on the momentum created by Dangote’s success and draw in additional investment if it wants to expand beyond supplying West Africa alone and instead become a major refining hub for the entire continent. He pointed to earlier European demand for jet fuel from the Dangote plant, which had affected domestic market conditions, as proof that Nigeria must deepen its refining capacity and build pricing systems flexible enough to respond to market pressures. He gave assurances that the government would continue backing the growth of a regional petroleum market and the institutional support needed to sustain it.
The conference, themed “Funding West Africa Infrastructure & Distribution to Create a Transparent Market for Regional Price Benchmarks,” was jointly organized by the Nigerian Midstream and Downstream Petroleum Regulatory Authority, S&P Global Commodity Insights, and the West Africa Regulators Forum, bringing together regulators, refiners, traders and financiers to discuss plans for a transparent regional pricing framework for refined petroleum products.
