Nigeria’s Dangote refinery, with a capacity of 650,000 b/d, has started selling gasoline domestically, exclusively to the state-owned NNPC. For September deliveries, NNPC is paying Dangote in US dollars, but a crude-for-gasoline swap will begin in October, settled in naira.
The refinery’s ex-refinery price for gasoline is set at $736 per tonne, equivalent to 898.78 naira per litre ($0.55/l), while the retail price in Lagos is N950.22/l, reflecting recent increases due to reduced government subsidies. Gasoline pricing is negotiated directly between parties under Nigeria’s Petroleum Industry Act.
NNPC has traditionally relied on imports to meet domestic gasoline needs but anticipates that Dangote’s operations will help reduce this dependency. Currently, the refinery is ramping up production, supplying 16 million litres over the weekend, which is still below its full capacity of 57 million litres per day.
Full operations are expected to commence by October or November once the residual fluid catalytic cracker (RFCC) is fully operational. Starting in October, NNPC will supply Dangote with 385,000 b/d of crude, with gasoline sold exclusively to NNPC for domestic distribution, while diesel will be available to other buyers.