Dangote Refinery Set For Competition as 23 New Refineries Near Completion — PETROAN
- A report by PETROAN has stated that 23 refineries are under development across Nigeria
- The new refineries are expected to add over 850,000 barrels per day to capacity
- The association stated that implementation gaps and supply challenges remain key concerns
Oluwatobi Odeyinka is a business editor at Legit.ng, covering energy, the money market, technology and macroeconomic trends in Nigeria.
The Dangote Petroleum Refinery is set to face increased competition as at least 23 new refineries across Nigeria move closer to completion.
Industry data released by the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) revealed that the refineries, currently at different stages of development, are expected to add more than 850,000 barrels per day (bpd) to Nigeria’s refining capacity once completed.
Source: Getty Images
PETROAN’s review of Nigeria’s petroleum sector for 2025 and outlook for 2026. made available to Legit.ng, was jointly signed by the association’s national president, Billy Gillis-Harry, and national public relations officer, Joseph Obele.
The Dangote Refinery, commissioned in 2023, is currently the only refinery producing Premium Motor Spirit in Nigeria.
Since the refinery started operations, Nigeria's dependency on importation has significantly reduced, although recent reports show that the NNPC Limited and other marketers imported 52.1 million litres of petrol per day in November, amounting to 1.563 billion litres for the month.
Over 30 refineries licensed — PETROAN
According to the association, over 30 refinery licences, mostly for modular and medium-scale facilities, have been issued since the Petroleum Industry Act (PIA) came into effect.
Out of this number, about 23 refineries are actively under construction or development.
PETROAN said the completion of these refineries would significantly expand domestic refining capacity, complement the Dangote refinery and reduce Nigeria’s reliance on imported petroleum products.
Dangote to raise production capacity to 1.4mmbpd
Meanwhile, Dangote Petroleum Refinery has announced plans to expand its capacity from 650,000 bpd to 1.4 million bpd by 2028.
The company said the expansion would be driven by advanced technologies in partnership with firms such as Honeywell, with the aim of becoming the world’s largest refinery and strengthening Africa’s energy independence.
However, industry stakeholders note that the Dangote refinery is yet to consistently operate at its full 650,000 bpd capacity. They attributed this to operational challenges, including constraints related to crude oil feedstock supply.
Source: Getty Images
Naira-for-crude policy not effective
The report also assessed the impact of the naira-for-crude policy, which allows domestic refineries to pay for allocated crude oil in naira rather than dollars.
According to PETROAN, the policy was not entirely successful as only an estimated 250,000 to 300,000 bpd of crude oil was supplied to local refineries in 2025.
PETROAN said the initiative helped ease pressure on foreign exchange demand, supported domestic refineries with a more predictable crude supply. The association noted that the policy also offered a framework for improved price stability, enabling refineries to plan operations based on guaranteed crude allocations.
However, it identified several implementation challenges. These include delays and inconsistencies in crude allocation, pricing disputes linked to differences between naira-based pricing and international crude benchmarks, and limited participation by some refineries.
The association further pointed to supply disruptions caused by pipeline vandalism and production shortfalls, which at times restricted crude availability and affected refinery output.
Dangote, marketers in price war
Legit.ng earlier reported that Dangote Refinery price cut forced marketers to also slash petrol prices in their respective depots as each fights for a share of Nigeria’s downstream petroleum market.
The move by independent marketers seeks to upstage the refinery, as the facility intensifies nationwide and international fuel distribution.
Experts have said the price war is a result of the full deregulation of the downstream petroleum market, where the fittest survive.
Source: Legit.ng
