The Dangote Group has announced a major step forward in its upstream expansion, confirming that it has achieved first oil from its oil assets and is preparing to begin commercial crude production in the coming weeks. The development marks a significant shift for the company as it moves to strengthen supply for its massive refinery operations.
According to Devakumar Edwin, Vice President of the Dangote Group, early testing has already begun on crude extracted from its licences in the Niger Delta. He explained that the company is currently in the well-testing phase, which is expected to last a few more weeks before full-scale production begins.
“We have opened a well and begun standard testing, which should be completed in the next three to four weeks maximum,” Edwin said. He added that once testing is concluded, production volumes will increase, paving the way for additional drilling activities.
The refinery’s leadership believes the move will improve supply stability. David Bird, Chief Executive Officer of the Dangote Refinery, noted that integrating upstream production could reduce dependence on external crude sources while also improving logistics efficiency. He added that the company is also exploring its own shipping capacity to cut costs and strengthen supply reliability.
Despite the progress, the company emphasized that crude sourcing decisions will remain commercially driven. Bird explained that Dangote’s upstream investments will continue to expand, but supply arrangements will still be based on value and operational efficiency. Nigerian regulators and partners have yet to comment on the development as of the time of reporting.
The development comes at a critical time as crude supply constraints have previously posed challenges to refinery operations. The Nigerian National Petroleum Company (NNPC) Limited recently increased its allocation to the Dangote Refinery to seven cargoes in May, up from five in previous months, in an effort to support operations.
source: The cable