The Dangote Petroleum Refinery has emerged as the world’s largest single exporter of aviation fuel, with plans to invest an additional $10 billion in expanding its capacity to 1.4 million barrels per day (bpd), according to S&P Global.
This milestone follows the refinery’s attainment of full operational capacity—650,000 bpd—in February, positioning it to capitalise on supply disruptions triggered by the Middle East conflict and significantly boost exports of refined petroleum products to global markets.
The planned expansion will require broader crude sourcing, with the refinery expected to process a more diverse range of feedstocks from Africa, the Middle East, the United States, and other producing regions. S&P noted that the facility currently processes up to 40 crude blends, with plans to increase this to over 100.
Chief Executive Officer, David Bird, said the expansion would strengthen the refinery’s standing as a global refining hub and deepen Nigeria’s participation in international petroleum trade. He noted that within weeks of reaching full capacity, the refinery ramped up aviation fuel output to address global shortages linked to the Middle East crisis.
“Sustaining current run rates demands a higher level of trading sophistication, pushing the limits of our logistics,” Bird said, describing the operation as a fully merchant refining model comparable to those in Europe and Asia.
Following the outbreak of conflict in the Middle East, the refinery shifted to what Bird described as “max jet mode,” becoming the world’s largest aviation fuel exporter in April, based on S&P Global Commodities at Sea data. The plant is also exceeding its petrol production potential by importing blending components such as GTL naphtha and Bonny condensate, enabling output of about 75 million litres per day, with capacity to reach 100 million litres with improved storage infrastructure.
S&P added that the expansion programme includes new projects aimed at diversifying feedstock sources, including a linear alkylbenzene plant, a diesel hydrotreater, and a 750,000 metric tonne-per-year propane dehydrogenation facility to convert imported LPG into polypropylene.
Although originally designed to process Nigeria’s light sweet crude, the refinery has faced challenges due to limited domestic supply and unreliable terminal infrastructure. Bird said the facility now processes 40 crude types but aims to approach the 130 blends handled at Singapore’s Pulau Bukom refinery, which he previously managed.
The $10 billion expansion is expected to raise capacity to 1.4 million bpd—equivalent to about 90 per cent of Nigeria’s current oil output—necessitating increased reliance on international crude streams. The refinery currently supplements local supply with U.S. WTI Midland crude and plans to incorporate heavier grades and residues as it scales up.
“We will be in the crude blending game,” Bird said, adding that Middle Eastern grades could account for up to 30 per cent of feedstock per processing train at full scale.
Dangote Group founder, Aliko Dangote, had earlier indicated interest in sourcing crude from countries such as the UAE and potentially Russia, subject to the lifting of sanctions. The refinery’s operating costs, currently below $2.50 per barrel, are projected to decline to about $1.50 per barrel after expansion, with South American residues also under consideration.
The company is also pursuing regional distribution infrastructure to stimulate demand, including a planned tank farm in Namibia linked to Zambia via pipeline, as well as potential projects in Djibouti and Cameroon. Currently, about half of the refinery’s output is exported, with all additional volumes from the expansion earmarked for international markets.
To improve efficiency, the company is gradually shifting from a spot trading model—largely managed by international traders—to longer-term supply agreements with governments, distributors, and national oil companies.
“We want to build direct offtake relationships and avoid being a supplier of last resort,” Bird said.
The refinery has also recorded increased demand from African buyers, including a recent supply agreement with Ethiopian Airlines. According to executives, improved financial capacity now allows the company to offer more competitive credit and payment terms.
Infrastructure upgrades are also underway, including a four-berth marine jetty designed to accommodate LR2 vessels and smaller cargoes, reducing reliance on road transport and addressing constraints associated with its single-point mooring system.
Bird said the expansion would largely replicate the existing plant design to accelerate delivery, though adjustments—such as different catalyst configurations—will be introduced to meet seasonal fuel specifications in key export markets.
The project is expected to be partly financed through an initial public offering later this year, with Dangote Group targeting a valuation of up to $40 billion. Between 5 and 10 per cent of shares will be listed on the Nigerian Exchange, with additional listings under consideration in London and Dubai.
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