Africa's largest oil refinery, owned by Aliko Dangote, is set for a major transformation that will significantly boost its ability to process crude oil from around the world. The refinery's Chief Executive Officer, David Bird, revealed in an interview with S&P Global Commodity Insights that the facility intends to expand its crude-processing capability from approximately 40 crude grades to as many as 130 varieties.
According to Business Insider Africa, this initiative is a key part of a broader expansion program aimed at doubling the refinery's capacity to 1.4 million barrels per day. The planned upgrade is expected to reduce the refinery's dependence on Nigerian crude supplies and position the Lekki-based facility as a major player in the international refining market.
Increased Flexibility to Boost Global Competitiveness
Bird explained that the refinery is being designed to operate like leading merchant refineries in Europe and Asia, rather than a conventional refinery that relies on a single source of crude oil. The ability to process up to 130 crude grades will give the refinery greater flexibility to source crude from multiple countries, allowing it to respond quickly to changes in global oil prices and supply conditions.
The expanded capability will also enable the refinery to manufacture a broader range of petroleum products that meet different international specifications, improving its access to export markets across various regions. Bird noted that the refinery will be able to process heavier crude grades and other foreign crude streams depending on prevailing market opportunities. He added that future expansion units could accommodate substantial volumes of Middle Eastern crude oil through blending operations.
Lower Costs and Stronger Export Strategy
The refinery's planned scale is expected to deliver significant cost advantages. Bird said operating costs could fall below $2 per barrel, strengthening the facility's position among the world's most efficient large-scale refining operations. With production volumes set to rise sharply, the company is also adjusting its marketing strategy. Rather than relying heavily on spot purchases and unpredictable truck demand, the refinery is seeking long-term supply agreements with international fuel distributors and national oil companies.
Bird emphasized that the company intends to build direct relationships with buyers, particularly in the aviation fuel market, to ensure stable product offtake while supporting local industry partners. If completed as planned, the expansion will further establish the Dangote Refinery as a globally competitive energy hub capable of sourcing crude from diverse markets and supplying refined products to customers around the world.
Meanwhile, Legit.ng earlier reported that Clarivo Oil and Gas Ltd announced plans to construct a world-class oil refinery in Calabar, Cross River state. Obidike Chukwuebuka, the company's CEO, said the proposed facility will be developed in multiple phases and feature state-of-the-art technologies designed to produce high-quality petroleum products. The company projects that the refinery will come online within about five years, subject to regulatory approvals and the successful completion of project phases.
