Nigeria is steadily emerging as a refining hub in West Africa, bolstered by the establishment of new private and state-owned refineries, including the Dangote Refinery.
However, challenges in crude oil supply to local refineries remain a significant obstacle, according to the Crude Oil Refinery Owners Association of Nigeria (CORAN).
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) recently issued a license for a 10,000 barrels-per-day refinery in Ughelli, Delta State, to MRO Energy Limited.
The CORAN welcomed this development but stressed the need for improved crude supply policies to support the country’s growing refining sector.
The NMDPRA’s licensing of MRO Energy Limited represents a strategic push to expand Nigeria’s refining capacity.
The move follows the agency’s reduction in licensing fees for new refineries last year, a step praised by the CORAN for encouraging investment in the downstream sector.
In addition to MRO Energy’s new facility, last year saw the licensing of a 27,000 barrels-per-day refinery in Akko, Gombe State, by Process Design and Development Limited.
Currently, Nigeria has nine operational refineries, with a combined capacity of less than one million barrels per day, according to the Nigeria Upstream Petroleum Regulatory Commission.
The CORAN’s Publicity Secretary, Eche Idoko, expressed optimism about Nigeria’s potential to become a major exporter of refined petroleum products. With its growing number of refineries, Nigeria could rival global refining hubs like Rotterdam.
Idoko emphasised that facilities like the Dangote Refinery already influence global petroleum pricing, a trend he believes will position Nigeria as a critical player in the international oil market.
Despite these advancements, local refineries continue to face hurdles in accessing crude oil. Idoko criticised the Nigerian National Petroleum Company Limited (NNPCL) for failing to meet the crude supply demands of modular refineries.
Additionally, President Bola Tinubu’s “Naira-for-Crude” initiative, which was intended to make crude accessible to local refiners at favourable terms, has reportedly been discontinued.
Idoko highlighted that no modular refinery currently receives crude from the government, further complicating their operations.
As Nigeria aims to reduce its dependence on imported petroleum products, the CORAN emphasised the need for policies that ensure steady crude oil supplies for local refineries.
The association called on the government to fulfil its promises and create an enabling environment to sustain the momentum in the refining sector.
