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Dangote refinery rules out 2020, as refinery gets new date 

Dangote Group has announced that its refinery would be commissioned by the end of first half in 2021. 

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Dangote refinery rules out 2020, as refinery get new operation date , Dangote Refinery to export products to Europe, South America, others , Dangote Refinery takes delivery of crude oil distilling equipment from China 

Dangote Group has announced that its refinery would be commissioned by the end of first half in 2021.

The Group Executive Director, Dangote Group, Devakumar Edwin, explained that when commissioned, the facility would meet 100% need of the country and export balance.

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[READ MORE: Dangote Refinery affirms commitment to youth development]

When production starts, the refinery will be able to process 650,000 barrels of crude oil per day into refined petroleum products. This will help Nigeria become an oil refining country and oil exporter as the country’s refineries are in dilapidated state. The capacity of the Dangote Refinery would eliminate fuel import from other regions into Nigeria.

No crude-for-fuel swap deal: Edwin also stated that the Dangote refinery would not be involved in NNPC’s (Nigerian National Petroleum Corporation) crude-for-fuel swap deal.

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“We are going to buy the crude just at the export price and will sell our products at the import price, the crude swap is operating only for the importers of the product.”

Dangote refinery rules out 2020, as refinery get new operation date 

Pipeline out of delivery routes: In a previous report by Nairametrics, Edwin disclosed that the plan is to transport the refined petroleum products by road and through the seaports when it begins operation. He also stated that the fuel produced by Dangote Refinery would be delivered by shuttle boats to Warri and Calabar while other deliveries would go in trucks.

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Dangote eyes European and American markets: The company also has its sight on other markets which include Europe and Latin America. These markets would have diesel, gasoline and other fuels delivered to them. The diesel is expected to meet winter standard in Europe, with high quality that will make it suited for any market.

[READ ALSO: $14 billion Dangote Refinery: uncertainty surrounds take-off]

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Dangote gunning for European refineries’ market: The Dangote refinery will be a problem for European refinery because they will be competing in the same market in West Africa. Most of the gasoline consumed in West Africa is supplied by European refinery, and with African leaders supporting the operation of Dangote Refinery, the status quo is expected to change.

Patricia

Olalekan is a certified media practitioner from the Nigerian Institute of Journalism (NIJ). In the era of media convergence, Olalekan is a valuable asset, with ability to curate and broadcast news. His zeal to write was developed out of passion to shape people’s thought and opinion; serving as a guideline for their daily lives. Contact for tips: fakoyejo.olalekan@nairametrics.com.

1 Comment

1 Comment

  1. Public Mail

    November 15, 2019 at 6:49 am

    Good to note the massive boost to domestic refining that this refinery would bring. But did Edwin say that delivery of refined products would be largely by road? Really? Really?!!!

    It would be a major drawback for the transportation system that is expected to be modernising and adopting updated practices. The train system and pipeline should be the major considerations not Road transportation. Definitely not.

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Business News

Hedge funds, institutional investors rush to own stakes in Bitcoin

Hedge funds are firms that offer alternative investments to a specific type of investors (high net worth individuals), in a bid to protect their investment portfolios from market uncertainty, while generating positive returns regardless of market sentiments.

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Bitcoin users rise in Nigeria despite Senate, CBN campaign against it, Nigerians losing millions to crypto fraud, Investing in cryptocurrencies in this economic shutdown, Bitcoin could hit above $100,000 by August 2021, Hedge funds, Institutional investors rush to have a stake in Bitcoin

With global economic uncertainty gradually becoming a daily norm, institutional and hedge funds around the world have been rushing to have a stake in crypto assets which  all have been outperforming other financial assets in 2020).

Just recently, a popular hedge fund based in New York –Grayscale Investments –caught the investment world by surprise by buying up Bitcoin (BTC) at a great rate in recent months.

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Lennard Neo, the head of research at Stack Funds, told Cointelegraph that institutional investors have been seeking for other options, not just to provide returns, but also to hedge their existing portfolio from downside risks. Neo said:

“Similar to Grayscale, Stack has seen an uptick in investors’ interest — almost double that figures of pre-crash in March — in Bitcoin. I would not say they are ‘gobbling up BTC’ blindly but cautiously seeking traditional structured solutions that they are familiar with before making an investment.” 

(READ MORE:The Empirical Truth about an average Nigerian’s price point)

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In addition, Paul Cappelli, a portfolio manager at Galaxy Fund Management, explained in detail the reasons for this demand. According to him, “we’re seeing increased interest from multiple levels of investors’ wealth channels, independent RIAs, and institutions.

“The recent BTC halving came at an interesting time amid the COVID-19 outbreak and the growing unease about quantitative easing. He noted: “It clearly demonstrated BTC’s scarcity and future supply reduction as concerns deepened around unprecedented stimulus by the Fed with the CARES Act.” 

Also, Michael Sonnenshein, the Managing Director of Grayscale Investments, explained briefly why his firm uses Bitcoin as an option in hedging its firm’s portfolio position.

“All three are facing issues this time around. Bitcoin has emerged as an alternative hedge, operating independently of the dramatic monetary policies enacted by central banks,” he said.

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What you need to know about Hedge Funds

They are firms that offer alternative investments to a specific type of investors (high net worth individuals), in a bid to protect their investment portfolios from market uncertainty, while generating positive returns regardless of market sentiments.

Patricia

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Business News

Measures introduced by Nigeria to ensure transparent use of the $3.4 billion IMF loan

Most of the critics of the government’s borrowing pattern have often expressed serious doubt about the judicious use of these funds, as they believe most of them might end up being embezzled.

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Kristalina Georgieva, IMF boss hints at 'synchronized slowdown' in global growth , IMF: 40% of African countries can't pay back their debts , Nigeria worse off, posts grows lower than LIDC benchmark - IMF, Measures introduced by Nigeria to ensure transparent use of the $3.4b IMF loan

Following the approval and disbursement of $3.4 billion Rapid Financing Instrument (RFI) to Nigeria, which is the largest COVID-19 emergency financing package so far released by the International Monetary Fund (IMF), the multilateral financial institution now expects transparent and accountable use of the funds.

The IMF’s financial assistance to Nigeria is meant to support the healthcare sector, stabilise the economy, and protect jobs and businesses that have been severely impacted by the pandemic.

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The Bretton wood institution has been disbursing funds to work closely with member countries to ensure transparent and judicious use of the financial support, while making sure they are used for the intended purpose.

The IMF’s mission chief for Nigeria, Amine Mati, during a conversation, pointed out the measures to be taken by Nigeria in order to enhance transparency and governance in the use of the $3.4 billion IMF emergency financing.

(READ MORE: Infrastructural financing in Nigeria: Why bonds are better than loans)

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According to the IMF chief, the Nigerian Government had committed to undertake an independent audit of crisis mitigation spending and related procurement processes, as well as to publish procurement plans and notices for all emergency response activities which include the names of companies that were awarded the contracts and the beneficial owners.

Mr. Mati also disclosed that special budget lines are to be created to record all crisis emergency response measures, which are published daily on Nigeria’s treasury online portal. These measures will not only ensure that financial assistance received as part of the COVID-19 response is used for its intended purposes, but will also significantly strengthen the oversight of the entire budget used for the government’s crisis response.

Implementing these measures will help to drastically reduce the governance and transparency challenges as well as corruption vulnerabilities of a country like Nigeria. Most of the critics of the government’s borrowing pattern have often expressed serious doubt about the judicious use of these funds, as they believe most of them might end up being embezzled.

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Economy & Politics

Brent crude drops, as traders focus on OPEC+ meeting

OPEC+ agreed in April to reduce output by an unprecedented 9.7 million barrels per day in May and June after the deadly COVID-19 pandemic weakened demand. 

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Brent crude drops to $25, oil demand drops by about 10% of world’s consumption, Brent Crude Oil hits $26, as Nigeria's Sweet Crude demand falls, Oil price pushes up before OPEC meeting, Asian equity markets mixed, NIGERIA OIL: Darker days ahead as Brent falls below production cost, Brent crude drops, as oil traders focus on OPEC+ meeting

Brent crude price dropped by around 0.77%, to $37.55 a barrel, on the first trading session of June.

The slump in the price comes after it posted its strongest monthly gains since 1999.

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“The focus is very much on OPEC+,” OCBC economist, Howie Lee, told  Reuters referring to OPEC and its allies including Russia. OPEC+ agreed in April to reduce output by an unprecedented 9.7 million barrels per day in May and June after the deadly COVID-19 pandemic weakened demand.

“We might see a cautious pullback in (crude) prices given that downstream prices haven’t caught up … but if OPEC+ does come up with a three-month extension, there’s a possibility that prices may hit the $40 level,” Howie Lee added.

Algeria, which presently holds the OPEC presidency, has started a move that an OPEC+ meeting scheduled for June 9-10 be brought forward to ease oil purchases for countries such as Saudi Arabia, Iraq, Kuwait, and Russia, who raised no objection.

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(READ MORE: Global oil prices drop after reports of unexpected inventory build)

“It’s been widely interpreted as likely to lead to an extension of the current production cuts,” CMC Markets’ chief market strategist, Michael McCarthy, said. 

“Oil prices have come down slightly in our session but they’re still at elevated levels. I suspect that’s the key driver of prices on Friday night and should keep prices reasonably well supported today,” McCarthy added.

 

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