Ghana may soon turn to Nigeria’s Dangote Petroleum Refinery for fuel imports as it reaches full operational capacity, potentially replacing the more expensive fuel imports from Europe, according to Mustapha Abdul-Hamid, Chairman of Ghana’s National Petroleum Authority. Speaking at the OTL Africa Downstream Oil Conference in Lagos, Abdul-Hamid suggested this shift could save Ghana the $400 million it spends monthly on European imports.
The $20 billion Dangote Refinery, based in Lekki, Nigeria, began distributing Premium Motor Spirit (PMS) into the Nigerian market in September 2024. Although Nigerian fuel marketers continue importing PMS due to deregulation, Abdul-Hamid expressed optimism that once the Dangote refinery reaches its capacity of 650,000 barrels per day, it could not only meet Nigeria’s needs but also support neighboring countries, including Ghana. “Instead of importing from Rotterdam, we could source from Nigeria, potentially lowering fuel costs for Ghana,” he said.
Aliko Dangote’s refinery is expected to be fully operational by early 2025. Abdul-Hamid noted that this could reduce shipping costs, ultimately lowering prices on other goods and services in Ghana. He also suggested that a unified African currency could decrease reliance on the dollar for regional trade.
Ghana’s economy, which expanded by 6.9% year-on-year in Q2 2024, has driven demand for fuel, particularly in its growing extractive industries.
Meanwhile, Farouk Ahmed, CEO of Nigeria’s Midstream and Downstream Petroleum Regulatory Authority, highlighted that the Dangote refinery will significantly enhance Nigeria’s fuel supply once it’s fully operational. The refinery has already been supplying diesel and aviation fuel domestically and internationally since February. Ahmed added that the facility’s output will further reduce Nigeria’s reliance on imported petroleum products, a dependence that has persisted for decades due to dormant state refineries.
Ahmed also stressed the need for a domestic pricing framework for Liquefied Petroleum Gas (LPG) to improve accessibility and affordability for Nigerian consumers. He noted that his agency has been working with local producers, including Chevron Nigeria, Mobil Producing Nigeria, and Nigerian LNG, to boost domestic LPG production and distribution.
He further detailed Nigeria’s ambitious energy targets, including 2 million barrels of oil production daily and a projected 10 billion standard cubic feet of gas for domestic use, aiming to transform Nigeria into a net exporter of petroleum products.
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