SEVEN MODULAR REFINERIES TO BOOST NIGERIA’S CAPACITY BY 83,000BPD IN 2027

Nigeria’s modular refining sector is expected to witness significant expansion in 2027, with seven additional refineries projected to commence operations at a combined capacity of 83,000 barrels per day.

George Maher-Bonnett of Argus Media disclosed this on Thursday in Lagos during a presentation at the OTL Africa Downstream conference, where he examined developments in Nigeria’s petroleum products market.

In his presentation titled African Energy Outlook, Maher-Bonnett revealed that four modular refineries were operational in Nigeria as of September, with a combined refining capacity of 32,000 barrels per day.

He added that seven more modular refineries were expected to begin operations next year, a development that would significantly increase the contribution of smaller facilities to the country’s domestic petroleum supply.

The projected additions would raise Nigeria’s modular refining capacity to more than 115,000 barrels per day, representing over three times the capacity of the four facilities operating in September.

However, the presentation did not identify the proposed refineries, their owners or locations, nor did it provide details of their individual capacities and expected commissioning dates.

Maher-Bonnett also highlighted the growing contribution of the Dangote Petroleum Refinery to Nigeria’s efforts to achieve self-sufficiency in petroleum products, despite a decline in domestic fuel demand this year.

According to the presentation, Nigeria’s fuel consumption has declined amid higher flat prices, while the country’s self-sufficiency level continues to improve as the Dangote refinery increases production.

It further noted that government intervention in the petroleum market during the period was limited, apart from a price reduction by the Nigerian National Petroleum Company Limited (NNPC) during the month.

On the performance of the Dangote refinery, Maher-Bonnett said the 700,000-barrel-per-day facility in Lekki was operating at a high rate, with its petrol output remaining steady.

The increased local production, he noted, has reduced the attractiveness of importing certain petroleum products from Europe into the West African market.

The presentation also highlighted developments in Ghana’s refining sector, noting that the 45,000-barrel-per-day Tema refinery was increasing production and improving domestic petroleum supply.

It further observed that the economics of transporting petroleum products from Europe to West Africa and the United States had weakened, with freight costs contributing to the challenges affecting the trade routes.

The anticipated expansion of Nigeria’s modular refining capacity comes amid rising domestic production, changing fuel consumption patterns and shifts in international petroleum trading.