Ghana Considers Dangote Refinery for Affordable Fuel Imports to Reduce European Dependency

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Olori Uwem

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Mar 18, 2024
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Ghana Considers Dangote Refinery for Affordable Fuel Imports to Reduce European Dependency

Detailed Breakdown:

Ghana is considering importing petroleum products from Nigeria’s Dangote Petroleum Refinery, a move that could replace the country’s $400 million monthly fuel imports from Europe with more affordable options from West Africa. Mustapha Abdul-Hamid, Chairman of Ghana’s National Petroleum Authority, highlighted this potential change on Monday during the OTL Africa Downstream Oil Conference in Lagos.

As the Dangote Refinery scales up operations, producing up to 650,000 barrels per day, Ghana could benefit from reduced import costs and shorter shipping distances, which would ultimately lower fuel prices. This local sourcing strategy aims to cut freight expenses significantly, making fuel more affordable across Ghana.

This shift aligns with Ghana’s growing fuel demand, driven by a strong expansion in the country’s extractive sectors. By importing fuel from Nigeria, Ghana also looks toward reducing its dollar dependency, with Abdul-Hamid suggesting that African nations could benefit from a unified currency in the future.

The Dangote refinery, built by Nigerian business magnate Aliko Dangote and valued at $20 billion, began releasing Premium Motor Spirit (PMS) into Nigeria’s market in mid-September. It is projected to reach near-full capacity by year-end, with full-scale operations expected in early 2025, potentially meeting a substantial portion of West Africa’s fuel needs.