Nigeria will start selling crude oil to the Dangote refinery in its local currency, the naira, beginning October 1, the finance ministry announced. This decision aims to alleviate foreign exchange pressures on the country’s largest oil refinery.
The $20 billion Dangote refinery, set to be Africa’s largest once fully operational, has faced difficulties in securing enough crude to meet its 650,000-barrel-per-day capacity since launching production in January.
Previously, Dangote was forced to purchase oil from the international market and criticized Nigeria’s oil regulator for not enforcing a law that mandates producers to supply domestic refiners.
Last month, the government authorized the state oil company NNPC to start selling crude oil to the Dangote refinery in naira.
Despite supply challenges, Nigerian refiners, including Dangote, have increased their domestic crude demand to 597,700 barrels per day (bpd) in the second half of 2024, up from 483,000 bpd in the first half, according to the regulator.