Nigeria: Dangote expands its crude oil storage capacity with 8 new tanks

The Dangote oil refinery, one of Africa's most ambitious industrial projects, has announced the construction of eight additional tanks to increase its storage capacity for imported crude oil. The initiative is in response to the unreliability of local supplies, a situation exacerbated by falling production and operational challenges facing the Nigerian oil sector.

At an estimated cost of $20 billion, the Dangote refinery is seeking to increase its crude storage capacity by 6.29 million barrels, or 1 billion liters. Once completed, this expansion will bring the facility's total crude storage capacity to 3.4 billion litres, up from the current 2.4 billion liters.

Devakumar Edwin, executive vice-president of oil and gas activities at Dangote Industries, said that four of the eight new reservoirs were already at an advanced stage of construction.

"Importing crude from other countries instead of buying locally means that our crude stocks will have to be higher. So we've started building eight extra tanks to hold a billion liters," said Edwin.

The refinery currently operates 20 crude storage tanks, each capable of holding 120 million litres. In addition, its tanks dedicated to refined products can store up to 2.34 billion liters, strengthening its capacity to meet national and regional demand for petroleum products.

Despite its position as Africa's largest oil producer, Nigeria is struggling to supply crude oil reliably to the refinery. The Nigerian National Petroleum Company (NNPC), the main entity responsible for supply, offers volumes that Dangote's managers consider insufficient.

This situation is forcing the refinery to rely more heavily on crude imports from other countries, a strategic choice if it is to maintain its operations at full capacity and meet the growing demand for fuel in the region.

Nigeria continues to face major challenges in its oil sector: - under-investment in infrastructure and production capacity ; - thefts and acts of vandalism on pipelines, which disrupt regular supplies and affect national production.

These problems have led the country to lose its position as Africa's leading oil producer on several occasions to other nations such as Angola.

Since it began operations last year, the Dangote refinery has played a key role in reducing Nigeria's dependence on fuel imports. With an estimated daily processing capacity of 650,000 barrels, the facility is not only a solution for the domestic market, but also aspires to become a regional hub for the supply of refined products.

"This increase in storage capacity reflects our commitment to respond proactively to supply challenges and to consolidate our position as a pillar of the energy sector in Africa," added Edwin.

By increasing its storage capacity and diversifying its sources of supply, the Dangote refinery is establishing itself as a strategic player in the transformation of the Nigerian and African energy landscape. However, the sustainability of these efforts will depend on the country's ability to resolve its structural problems and guarantee a reliable supply of crude over the long term.