The Economist Intelligence Unit (EIU), the world leader in global business intelligence & market insights, on Wednesday, warned that further delays in crude oil feedstock to the Dangote Petroleum Refinery and Petrochemicals could jeopardise Nigeria’s economic recovery.
This, it further noted, would put additional pressure on the naira, advocating for support for the $20bn refinery to transform the country’s oil sector.
“The Dangote fuel refinery is potentially transformational for Nigeria, which has always been an oil exporter and fuel importer. This fact is often regarded as a failure and an embarrassment by politicians, businesses and the media alike, but the new refinery has the ability to change this,” it said.
EIU which is the research and analysis arm of the Economist Group said the Dangote refinery which began production in January has encountered setbacks in petrol production due to a shortage of crude oil feedstock.
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The report pointed out that the refinery has successfully exported various products, including fuel, naphtha, nitrogen fertilisers, gasoil, jet fuel, and diesel but has not been able to ramp up petrol production due to challenges in sourcing adequate crude oil.
Daily Trust reports that there has been back and forth between Dangote and the oil industry regulator especially the Nigeria Upstream Petroleum Regulatory Commission (NUPRC) over crude supply shortage.
But the EIU report noted that the inadequate supply of crude to Dangote refinery would have significant economic repercussions for Nigeria, potentially worsening the already strained relationship between public finances and the management of the naira, the country’s currency.
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