Nigeria Approves New 10,000-Barrel Refinery in Delta State
The Nigerian government has approved the construction of a 10,000-barrel refinery in Delta State, marking a significant step toward increasing the country’s domestic refining capacity. The license for this project has been granted to MRO Energy Limited, an energy company, to establish the refinery at Imode in Ughelli, Delta State.
This decision aligns with Nigeria’s strategic efforts to address long-standing challenges in its energy sector. Despite being one of the world’s largest crude oil producers, Nigeria faces the paradox of exporting crude oil while importing a significant portion of refined petroleum products. This imbalance has had severe economic, social, and security implications, which the government aims to mitigate by boosting domestic refining capabilities.
Tackling the Refining Paradox
The approval of new refineries is part of Nigeria’s broader plan to address inefficiencies in its energy sector. The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) announced the latest development through an official statement on its X (formerly Twitter) page.
The move comes amid increasing efforts by the government to attract private sector investments into the refining industry. Nigeria’s reliance on imported refined petroleum products has strained the economy, creating vulnerabilities in fuel supply and contributing to high costs for consumers. By fostering domestic refining, the government aims to enhance energy security and reduce dependency on foreign imports.
Boosting Refining Capacity
The new refinery in Delta State adds to the growing number of refineries in Nigeria, bringing the total count to 11, including both modular and conventional facilities. This development follows a recent partnership agreement involving Claridge Petroleum Company Ltd, Oasis Petrochemical Products Limited, and Afrintech to construct a 50,000-barrel refinery in Akwa Ibom State, also in Nigeria’s South-South region.
Nigeria has set ambitious targets to process over two million barrels of crude oil per day, translating to 62 million barrels per month. According to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), the government-owned refineries, the Dangote Petroleum Refinery, and eight other domestic facilities are expected to collectively process 770,500 barrels per day from January to June 2025.
To achieve these goals, the government has introduced initiatives such as the crude oil delivery program, designed to ensure a consistent and reliable supply of crude oil for domestic processing. This initiative aims to improve operational efficiency and maximize the output of Nigeria’s refineries.
A New Era for Private Refineries
Nigeria is witnessing a rise in privately owned refineries, spurred by government policies encouraging private sector participation. Among these is the Dangote Refinery, which boasts an installed capacity of 650,000 barrels per day, making it the largest single-train refinery in the world.
As new refineries come online and existing facilities undergo rehabilitation, Nigeria’s refining capacity is expected to grow significantly in the coming years. This will reduce the country’s reliance on imports, enhance energy security, and support economic growth.
The establishment of the Delta State refinery underscores Nigeria’s commitment to tackling its energy challenges and achieving self-sufficiency in refined petroleum products, paving the way for a more stable and prosperous future.
