FG presents trading platform for crude oil supply to Dangote Refinery, others

The Federal Government has unveiled a new automated crude oil trading platform designed to streamline the supply of crude oil to indigenous refineries, including the Dangote Refinery. The initiative brings together key stakeholders such as industry regulators, crude oil producers, refineries, and oil marketers to improve coordination in crude oil production, allocation, pricing, and delivery. This comes amid efforts to reduce Nigeria's dependence on imported crude oil and boost domestic refining capabilities. The platform was introduced during a presentation to stakeholders in Lagos, showcasing how regulators, producers, refiners, and traders can engage in real-time trading. This innovation aims to eliminate inefficiencies and disputes that previously hindered the flow of crude oil to local refineries. According to the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), the Dangote Refinery required 63 million barrels of crude oil in the second quarter of 2026, yet only 52.6 million barrels were accepted, representing 78 percent of the volume offered by producers. This discrepancy highlights ongoing challenges in matching supply with demand. Devakumar Edwin, Group Vice President, Oil & Gas and Fertiliser, at Dangote Industries Limited, emphasized the company's commitment to purchasing Nigerian crude oil, provided it is available in sufficient quantities and at competitive prices. He stressed the importance of securing reliable crude supplies to ensure the economic viability of domestic refining and enable the delivery of petroleum products at affordable rates to consumers. Momoh Jimah Oyarekhua, President of the Crude Oil Refinery-Owners Association of Nigeria (CORAN) and Chairman of OPAC Refineries, noted that local refineries are increasingly meeting domestic demand for petroleum products, thereby reducing Nigeria's reliance on imports. He highlighted that Nigerians are once again relying more on internally produced petroleum products, a shift he attributed to growing domestic refining capacity. However, he acknowledged that crude oil supply remains a critical challenge for refinery operators. Oyarekhua pointed to the Domestic Crude Supply Obligation (DCSO) as a key factor driving collaboration among stakeholders. He explained that the challenges faced by refineries are being addressed through increased cooperation with regulatory bodies and better responsiveness from crude oil producers. Despite progress, he expressed cautious optimism, stating that further improvements are necessary to fully optimize crude oil supply and ensure refineries operate at maximum capacity. Oyarekhua also mentioned that refinery owners and other downstream players are working collectively to strengthen the domestic supply chain. He observed that many downstream actors are increasingly sourcing petroleum products from within the country, contributing to the gradual reduction in import dependency. These developments underscore the broader effort to revitalize Nigeria's downstream petroleum sector and promote self-sufficiency in energy production. As the government and industry players continue to refine their strategies, the success of the new trading platform will depend on sustained collaboration and effective implementation. With ongoing dialogue and adjustments, there is potential for the sector to achieve greater efficiency and resilience, ultimately supporting Nigeria's goal of becoming a net exporter of petroleum products.