Dangote Refinery Faces Crude Supply Shortage Challenges

In a recent interview, Mr. David Bird, Managing Director of Dangote Refinery, highlighted serious concerns regarding the federal government's crude oil naira scheme, which has resulted in a mismatch between the volume of crude oil supplied and the refinery's operational needs. The refinery requires 19.5 million barrels of crude oil monthly to operate at full capacity of 650,000 barrels per day but is currently receiving only 5 million barrels.

This shortfall has forced the refinery to import 14 million barrels of crude oil monthly, costing approximately $3.7 billion. Bird clarified that the crude oil naira scheme is not a subsidy or discount program but operates on commercial terms.

The inadequate supply has led to higher petrol prices, with the cost of imported petrol being significantly higher than local production costs. Bird criticized the federal government's decision to lift the ban on petrol imports, arguing it undermines the refinery's potential to boost Nigeria's economy and foreign reserves.