Nigeria’s biggest fuel processing plant, Dangote Refinery, says it looks forward to switching entirely to Nigerian crude oil by the end of 2025, potentially ending its importation of hundreds of thousands of barrels of oil daily.
The company’s intention was disclosed by Devakumar Edwin, Vice President at Dangote Industries, according to Bloomberg.
“We expect some of the long-term contracts will expire,” vice president at Dangote Industries, Devakumar Edwin said in an interview last week at the sprawling site.
“Personally, and as a company, we expect that before the end of the year we can transition 100% to local crude.”
Edwin said that domestic producers are set to supply more crude as some of their long-term contracts with foreign buyers expire.
Since its commissioning in May 2023, the 650,000 b/d plant has increasingly sourced crude from the U.S. and other countries due to insufficient supplies from domestic producers.
According to Edwin, the Dangote plant sourced 53% of its crude in June from Nigerian producers, while 47% came from the United States.
Nigeria now a net importer of crude
These crude imports by the Dangote Refinery have turned Nigeria, Africa’s largest crude producer, into a net importer.
In Q1 2025, Nigeria spent a staggering $2.6 billion on crude oil importation, according to data from the country’s apex bank.
A significant portion of these imports came from the U.S., which served as the primary foreign source of crude for the Dangote plant, which has grown so rapidly in a few years to become a major player in Nigeria’s midstream and downstream markets.
The U.S. accounted for roughly 61% of Nigeria’s total crude imports during the quarter, according to a recent report by the National Bureau of Statistics.
Other sources of crude for Dangote include Brazil, Angola, Algeria, Ghana, and Equatorial Guinea.
The Central Bank of Nigeria (CBN) also reported that the country’s crude and petroleum product imports in the quarter rose by 11.19% to reach $2.98 billion, up from $2.68 billion in Q4 2024.
Ramping up production
The Dangote plant is gradually ramping up operations to meet its full capacity of 650,000 b/d, up from the current 550,000 barrels daily.
This will require a significant increase in local oil supplies over the coming months, but Edwin says improved relations between the refinery, local oil traders, and the government will help ensure steady supplies.
Meanwhile, citing trading sources, Reuters reported that the Dangote Refinery is set to import at least five million barrels of U.S. WTI crude oil in July.
Similarly, according to a list of cargo allocations, the plant will be receiving five cargoes from NNPC this month. Each shipment holds nearly a million barrels of crude.
The refinery’s decision to substitute imports with domestic supplies is forecast to improve the balance of payments (BOP) and increase GDP through value-added processing.
It is also expected to reduce foreign exchange pressures, which could help stabilize or even strengthen the naira, in addition to creating jobs and improving Nigeria’s industrial base.
Omono Okonkwo, an energy market commentator, says the move will trigger a cascade of changes across Nigeria.
“For the affluent, this means price stability and investment opportunities in downstream industries that can now rely on predictable, locally sourced feedstock.
But the most profound impact will be felt by ordinary Nigerians; whose transport costs decrease, and whose food supplies can be bought at more affordable rates,” Okonkwo said.