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

The Dangote Oil Refinery has capability to produce winter diesel for the European market, an executive said on Tuesday, a further sign of its potential to interfere with the global refining market.

The refinery developed by Nigerian billionaire Aliko Dangote on the outskirts of Lagos is anticipated to strike production of 550,000 barrels per day (bpd) this year, equivalent to 85% of its 650,000-barrel capability.

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

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

Devakumar verified reports that the refinery would quickly export its very first gasoline, an approximated 200,000 metric loads targeting West African and Caribbean markets.

The items for the majority of the marketplace will be packed as vessels arrive. Euro V gasoline will be shipped from completion of the year, he stated.

The refinery, which is required by the government to sell locally to lower need for U.S. dollars, has actually had a hard time to disperse fuel in Nigeria, mostly due to pricing. Last month, Aliko Dangote stated the refinery had a stockpile of 500 million litres of gas.

After state-oil company NNPC began selling gas at market rates last month, it relinquished its function as the sole buyer of the refinery's output, enabling regional traders to import fuel after becoming involved in a pricing conflict with the refinery.

Nevertheless, the Independent Petroleum Marketers Association of Nigeria, a fuel trading group with more than 150,000 outlets across the country, stated on Monday it had reached an agreement to buy directly from the refinery at cheaper rates, while NNPC stated it had stopped importing petrol.

Fuel presently costs 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 items consisting of naphtha, diesel and aviation fuel, with Ghana among those revealing an interest in purchasing from the refinery.

(source: Reuters)