The Dangote Petroleum Refinery has resumed the purchase of crude oil from the United States in its ongoing efforts to ramp up oil production and enhance its refining capacity.
According to a report by Bloomberg, a cargo conveying two million barrels of WTI Midland crude from Chevron Corp is due to be delivered to the refinery in December.
The new purchase comes after a three-month hiatus in purchasing crude from foreign countries, focusing instead on domestic supply.
The latest development couldalso be an indication that the naira-for-crude initiative by the Federal Government may have stalled or that the refinery is not getting enough crude supply from the Nigerian National Petroleum Company (NNPC)Limited.
“Dangote refinery purchased its first shipment of US oil after a hiatus of three months as the site continues to ramp up production.
“The plant purchased about two million barrels of WTI Midland crude from Chevron Corp,” the report said.
Chevron booked the supertanker Azure Nova to load crude from the US Gulf around December 5 to Dangote, according to tanker fixtures seen by Bloomberg.
Earlier this year, Dangote was typically receiving one or two supertankers of US crude every month alongside domestic supplies.
However, these imports were reduced around August following an agreement with the federal government that the NNPCL would supply crude oil to the refinery in naira rather than dollars.
The agreement stated that the refinery would take up to 400,000 barrels a day of Nigerian crude paid for in local currency.
Dangote is taking a growing role in US and European oil markets, after gradually raising purchases of crude from Nigeria and the US.
The plant’s pull on those barrels increases the competition for the oil faced by traditional buyers in Europe.
The report added that reasons for the return to US imports remain unclear, though a report from Sparta Commodities earlier this week suggests lower shipping costs may have made US oil more affordable in Europe recently.
An earlier report had indicated that the refinery was seeking to raise billions of dollars to import crude oil and increase production and that the Chairman of Dangote Group, Aliko Dangote, was in concrete talks with commercial lenders, development banks, oil traders, and other industry participants to raise funds for crude supplies to turn into refined products.
According to the report, the refinery would need a minimum supply of 300,000 b/d to secure more crude to reach its capacity.
On Tuesday, it was reported that the plant began refined petroleum product shipping to West African countries, a sign to traders that the mega-refinery’s operations could soon potentially shake up regional fuel markets.
