Dangote Refinery with capacity to process 650,000 barrels per day (bpd) of oil being built in Nigeria is due to come onstream by the end of 2019, the oil minister said on Tuesday.
“That should be enough to meet local needs,” Minister of State for Petroleum Resources Emmanuel Ibe Kachikwu told an oil and conference in Cape Town, referring to the Dangote refinery.
State oil firm NNPC last year launched bidding to find partners to overhaul its ailing refineries, which hardly produce any petrol due to decades of mismanagement and widespread graft, leaving OPEC member Nigeria reliant on imported oil products.
Kachikwu said Nigeria was close to finalising the process for private partners to revamp three existing refineries, adding a total of 450,000 bpd, part of the effort by Africa’s biggest economy to reduce its reliance on imports.
Kachikwu said 26 firms had indicated their interest in the revamp projects that will require investment of $2 billion.
“We are almost at a threshold of finalising the process of selection,” he said, adding that it could announce its selection by January or February.
The government has previously said it was in talks with Chevron, Total and ENI.
Kachikwu told reporters that Nigeria aimed to lift oil output in January to 1.8 million bpd from about 1.6 million to 1.7 million bpd now, but would not breach a ceiling agreed with the Organization of the Petroleum Exporting Countries (OPEC). “If we get to 1.8 (million), then we need to say ‘hey, close off the taps, because we need to comply,” he said.
He also said oil prices were now encouraging but OPEC had not ruled out further cuts to shore up the market.
“The market is balancing fast …. But do we need to see more cuts? We’ll see,” he said.
OPEC, Russia and other producers cut oil output by about 1.8 million bpd since January. The pact runs to March 2018, but they are considering extending it.