- Dangote Refinery: We’ll Buy Nigerian Crude, But It Must Be Available and Competitively Priced
LAGOS — The Dangote Petroleum Refinery and Petrochemicals has reaffirmed its commitment to sourcing crude oil locally, saying Nigerian crude must be available in sufficient quantities and offered at commercially competitive prices to sustain domestic refining and ensure affordable petroleum products for consumers.
The clarification followed recent reports citing data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), which indicated that the refinery rejected about 15.5 million barrels of crude oil offered by domestic producers in the second quarter of 2026.
The refinery, however, explained that the key issue is not the volume of crude oil nominally offered under the Domestic Crude Supply Obligation (DCSO) framework, but the quantity genuinely available for purchase at commercially viable prices.
Group Vice President, Oil & Gas and Fertiliser, Dangote Industries Limited, Devakumar Edwin, said the refinery remains willing to purchase Nigerian crude, provided the supplies are adequate and priced competitively.
“Our position is straightforward. We are ready and willing to purchase Nigerian crude oil, provided it is available in sufficient volumes and at competitive market prices,” Edwin said.
He explained that, since the commencement of the DCSO framework, the refinery has experienced significant challenges in securing crude directly from domestic producers.
As a result, a substantial portion of crude allocated under the arrangement has had to be sourced through International Oil Companies (IOCs) and other third parties rather than directly from Nigerian upstream producers.
According to Edwin, the additional layers of intermediaries often introduce premiums and transaction costs, resulting in crude being offered at prices significantly above prevailing international market benchmarks published by agencies such as Platts and Argus.
He noted that when domestically sourced crude becomes more expensive than comparable international supplies, it undermines the economics of domestic refining.
“When additional layers of intermediaries introduce premiums, the cost of crude acquisition increases significantly, affecting the overall economics of domestic refining. Ultimately, higher crude costs translate into higher costs of refined petroleum products for the local market,” he said.
Edwin stressed that the refinery’s position should not be interpreted as a rejection of Nigerian crude or the objectives of the DCSO framework.
Rather, he said the refinery is seeking a sustainable arrangement that ensures crude oil supplied under the domestic framework is available, competitively priced and commercially viable.
He maintained that securing crude at sustainable market-based prices remains critical to the refinery’s ability to operate efficiently, support local value creation and provide petroleum products to Nigerians at affordable and competitive prices.
The Dangote Refinery reiterated that it remains committed to the development of Nigeria’s domestic refining capacity and to sourcing Nigerian crude whenever the volumes and commercial terms make such purchases economically sustainable.