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Market Chatter: Dangote Plans Second 700,000 Bpd Refinery at Nigeria's Lekki Complex

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Dangote Group is building a second 700,000-barrel-per-day refinery at its Lekki site in Nigeria, a project that would increase the complex's total processing capacity to 1.4 million b/d by the end of 2028, Bloomberg reported Thursday, citing Chief Executive Officer David Bird.

Site preparation and piling work are underway, and steel installation should begin before year-end, Bird said on the sidelines of S&P Global's Middle East Petroleum & Gas Conference, according to the report.

The project comes as Dangote also works to raise capacity at its existing refinery to 700,000 barrels per day from 650,000, further expanding the company's refining footprint, the report said.

The combined facilities would rank among the largest refining hubs globally, matching the scale of Reliance Industries' Jamnagar complex in India and far exceeding the capacity of Europe's biggest refinery, according to the report.

By increasing domestic fuel production, the existing refinery has reduced Nigeria's dependence on imported petroleum products while also supplying export markets, including Europe, the report said.

The refinery entered service in early 2024 after Dangote unveiled the project in 2023, marking the completion of a development that arrived seven years behind its original schedule, according to the report.

Although the targeted startup date appears ambitious for a project of this size, Wood Mackenzie Senior Vice President Alan Gelder said successful execution remains possible.

Bird said the company expects to shorten development timelines by repeating the design-and-construction model already used for the first refinery.

Growing fuel production from the Nigerian facility has attracted interest from other African countries, with Kenya recently indicating that it could host a future Dangote refinery, the report said.

An East African project would expand the group's reach in international fuel markets and support additional oil-trading activity.

If the proposed East African refinery mirrors the Nigerian operation, Dangote's total processing capacity could approach 2 million b/d, roughly equal to Germany's current oil consumption, the report said.

Dangote didn't immediately respond to' request for comment.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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