Dangote Refinery Gains Global Edge as European, US Refinery Shutdowns Tighten Fuel Markets

The recent closure of refineries across Europe and North America has reshaped global fuel supply, offering Nigeria’s Dangote refinery an opportunity to play a pivotal role in stabilizing refined product balances. Energy intelligence firm Kpler highlighted that nearly 900,000 barrels per day (bpd) of refining capacity have permanently exited the system, tightening margins and leaving markets more vulnerable to outages.

Kpler’s report explained that the Atlantic Basin is entering a “structural inflection point” due to these shutdowns. With Europe losing nearly 800,000 bpd and North America exiting additional capacity, reliance on late-cycle mega-refineries, such as Dangote’s 650,000 bpd plant, has surged. However, despite progress in commissioning units, the refinery’s influence remains limited, as operational setbacks have capped throughput at around 60–65%.

Mechanical issues at Dangote’s core conversion unit, the RFCC, have prevented full utilization, prompting a major corrective shutdown in mid-December. Kpler emphasized that this pause is a “pivotal inflection point,” and successful completion could allow the refinery to move from marginal participation to a structural role in global clean fuel balances by mid-2026, producing approximately 300,000 bpd of gasoline, 150,000 bpd of gasoil, and 140,000 bpd of jet fuel at full capacity.

The Dangote Group has ambitious plans to expand the refinery to 1.4 million bpd, aiming to make it the world’s largest. Managing Director David Bird confirmed that the facility now operates round-the-clock, supplying 50 million litres of petrol to the market. Engineers India Limited will oversee the expansion project, valued at over $350 million, as both Project Management Consultant and EPCM consultant, with a projected completion within three years.

Until the Dangote refinery achieves full operational capacity, global fuel markets remain vulnerable as European refining continues to shrink. The refinery’s successful ramp-up could ease international tightness while ensuring a steady domestic supply, marking a milestone for Nigeria’s role in the global energy landscape.

source: punch