The expansion of Aliko Dangote’s refinery to 1.4 million barrels per day is expected to boost Nigeria’s fuel production and potentially make the country a key player in the regional energy market.
According to Noah Ajare, Managing Director and CEO of Oriental Oil and Gas Services Limited, this move could accelerate import substitution and strengthen Nigeria’s position as a regional fuel supplier.
Ajare said if realised, the expansion would further anchor production stability and provide lasting relief from costly fuel imports.
He stated this in his paper titled: “Nigeria Sees Production Stability and Import Relief as Downstream Capacity Expands.”
Ajare, who is also the founder of African Energy Academy Limited, said Nigeria’s long-standing dependence on imported refined petroleum products is showing signs of moderation as domestic downstream refining capacity expands.
He said the 650,000-barrel-per-day Dangote Petroleum Refinery has begun to make a measurable dent in fuel imports, particularly petrol and jet fuel.
“Aviation jet fuel supplied by the facility now accounts for roughly two-thirds of Nigeria’s domestic demand, displacing foreign cargoes and reducing exposure to global price swings. Data from January 2025 showed Nigeria’s gasoline imports at about 110,000 barrels per day, the lowest since 2017, driven in part by increased domestic output,” he said.
Ajare noted that the production gains have translated into meaningful import relief.
He cited foreign trade data from the Nigerian Bureau of Statistics, which showed that Nigeria’s petrol import bill in the first quarter of 2025 declined by 54 per cent compared with the same period in 2024, falling from N3.81 trillion to N1.76 trillion, coinciding with the refinery’s scale-up of supply to the domestic market.
According to him, this sharp drop marks one of the most significant reversals of fuel import costs in recent years and helps ease pressure on foreign exchange reserves previously dominated by refined product purchases.
He noted that domestic supply has not yet fully eliminated Nigeria’s reliance on fuel imports, as structural challenges persist.
“Official figures show that in 2025 imported petrol still accounted for around 62 percent of total consumption, with local production covering the other 38 per cent a significant improvement from near-total import reliance before the refinery’s operation.
“Logistics bottlenecks, crude supply arrangements, and distribution constraints continue to limit how quickly production gains translate into nationwide supply stability,” he explained.
He said many analysts see the shift as a turning point, noting that beyond the immediate foreign exchange savings, the growth in domestic refining supports broader macroeconomic stability by shortening supply chains and improving energy security.
