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Dangote Oil Refinery can now process winter season diesel, executive states

The Dangote Oil Refinery has capability to produce winter season diesel for the European market, an executive stated on Tuesday, a more sign of its capacity to disrupt the global refining market.

The refinery developed by Nigerian billionaire Aliko Dangote on the borders of Lagos is expected to hit production of 550,000 barrels daily (bpd) this year, equivalent to 85% of its 650,000-barrel capacity.

It started operations in January with output of products consisting of naphtha and jet fuel and started processing gas in September.

We will have surplus production for export in all our items - gas, diesel, jet fuel, carbon black feed stock and polypropylene, stated Edwin Devakumar, head of the refinery.

Without providing additional information, Devakumar confirmed reports that the refinery would quickly export its first gas, an approximated 200,000 metric heaps targeting West African and Caribbean markets.

The refinery, which is obliged by the government to offer products into the regional market to cut demand for U.S. dollars, has actually had a hard time to distribute gas in Nigeria, mostly due to pricing. Last month, Aliko Dangote said the refinery had actually a. stockpile of 500 million litres of fuel.

After state-oil company NNPC began offering gas at market. rates last month, it relinquished its function as the sole purchaser of. the refinery's output, allowing regional traders to import fuel. after ending up being involved in a rates disagreement with the refinery.

However, the Independent Petroleum Marketers Association of. Nigeria, a fuel trading group with more than 150,000 outlets. across the country, said on Monday it had actually reached a contract. to purchase straight from the refinery at cheaper rates, while. NNPC said it had stopped importing gas.

Gas currently sells at around 1,090 naira ($ 0.6537) on. average in Lagos and around 1,200 naira in the capital Abuja and. other significant cities.

The refinery has been exporting the bulk of its other. products including Naphtha, diesel and air travel fuel, with Ghana. amongst those revealing an interest in buying from the refinery.

(source: Reuters)