Ghana could buy petroleum products from Nigeria’s Dangote Petroleum Refinery once the facility is operating at full capacity, cutting more expensive exports from Europe, the head of the country’s oil regulator said on Monday.
Chairman of the National Petroleum Authority, Ghana, Mustapha Abdul-Hamid, said this could end monthly fuel imports from Europe of $400m. He spoke at the OTL Africa Downstream oil conference in Lagos, Reuters reported.
The $20bn Lekki-based Dangote refinery commenced the release of Premium Motor Spirit, popularly called petrol, into the Nigerian market on September 15, 2024.
But despite this, marketers of the product in Nigeria have since commenced the importation of PMS in hundreds of millions of litres following the total deregulation of the downstream oil sector in Nigeria by the Federal Government.
However, at the function in Lagos on Monday, the Ghanaian petroleum authority official stated that his country might start importing fuel from the Nigerian refinery.
“If the refinery reaches 650,000 bpd a day capacity, all that volume cannot be consumed by Nigeria alone, so instead of us importing as we do right now from Rotterdam, it will be much easier for us to import from Nigeria and I believe that will bring down our prices.” Hamid said.
The Dangote refinery built by Nigerian billionaire Aliko Dangote is expected to operate at near full capacity at the end of the year and analysts believe it could be fully operational in the first quarter of 2025.
Hamid said importing from Nigeria rather than Europe would bring down the prices of other goods and services by removing freight costs. Eventually, he said African countries would agree on a common currency that should dampen demand for dollars.
Ghana’s economy, which grew by 6.9 per cent year-on-year in the second quarter of 2024, has been driven largely by a strong expansion of the extractive sector, which has boosted demand for fuel.
In February 2024, the refinery issued tenders to sell two fuel cargoes for export, the first from the newly commissioned refinery, trading sources with knowledge of the matter told Reuters.
Recall that on February 8, 2024, indications emerged that lingering regulatory approvals had stalled Dangote Petrochemical Refinery’s plan to release aviation fuel (Jet A1) and diesel for sale in the Nigerian market in January.
On October 24, it was reported that the refinery started supplying Premium Motor Spirit, popularly called petrol, to some oil marketers directly without recourse to the Nigerian National Petroleum Company Limited.
“Marketers are already coming to the refinery to lift PMS. They are lifting directly from the refinery, not through a third party.
“We have reached agreements with some of the marketers and more are still ongoing. I don’t know the exact price, but if the price is not good, the marketers would not be coming to us,” the official stated.
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