Monday, November 29, 2021

New Nigerian refinery will change West African product flow, says Poten

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US shipbroker says new oil refinery will affect suezmax and LR2 trades.

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A top US shipbroker has said that a new oil refinery opening in Nigeria as early as next year could be bad news for regional tanker trades.

Poten and Partners said the new facility at Dangote will dramatically affect the way crude and refined products flow in Nigeria and the wider West Africa region.

The Dangote refinery is being built in the Lekkie Free Zone on Nigeria’s coast, about 30 miles east of Lagos.

“At the moment, Nigeria exports almost all its crude oil because none of its domestic refineries are currently operational,” Poten said.

“Nigeria exports its crude to a diverse group of countries, both in the Atlantic Basin and the Pacific and unlike some other OPEC producers which favour terms deals, Nigeria sells most of its crude on the spot market.”

“A significant decline in Nigerian exports resulting from the startup of Dangote would therefore primarily hurt the suezmax segment.”

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