The African Petroleum Producers Organisation (APPO) has assessed the impact of the ongoing Dangote Oil Refinery on the importation of petroleum products production into Africa.

According to the organization, the oil firm owned by Africa’s richest man, Aliko Dangote, when completed will save the continent of at least 36 per cent oil importation struggle.

The APPO Secretary-General, Dr. Omar Farouk Ibrahim, made the observation during an interview yesterday. He noted that the refinery would be supplying over 12 per cent of Africa’s demand when it becomes operational.

That is huge savings for a continent that has scarce foreign exchange and little to export. We shall save from buying abroad and from shipping and insurance costs. Furthermore, the success of Dangote could incentivise the rise of similar projects, the noise about energy transition notwithstanding,” the oil analyst noted.

Ibrahim noted that though there is a focus on energy transition, Dangote should go on with the construction of his crude oil refinery, adding that the demand for fossil fuel is going to continue for several decades to come.

Ibrahim stated, “To appreciate the impact that the Dangote refinery is going to have on African economies and especially on the supply of petroleum products, and to some extent the conservation of scarce foreign exchange, a look at some statistics on the continent’s petroleum products demand and supply is in order.

“Currently, Africa’s daily petroleum demand is 4.3 million barrels per day (mbd). Of this volume, 57 per cent is produced locally (on the continent) while 43 per cent is imported. When Dangote is fully operational, the percentage of Africa’s products imported shall drop to 36 per cent. This is even as the total volume of products demand rises to 5.4 mbd.

“You can therefore see the huge impact that Dangote refinery shall be made to overall products supply in Africa. Dangote shall be supplying over 12 per cent of Africa’s products demand.

Speaking further, the economist said because new refineries are not springing up in Europe and North America, where Africa imports 34% of its supplies because their governments have embraced energy transition, some willingly, others due to pressure.

The APPO Secretary-General, however, urged African refiners to invest more in technology and develop the right expertise to manage their refineries, which are going to serve the continent as western refiners halt the establishment of more refineries