By Peter.
Nigeria’s midstream and downstream petroleum sector continues to underperform, with refinery utilization averaging just 61.58% from Q1–Q3 2025 despite a combined installed capacity of 1.125 million barrels per day (bpd), according to the latest NMDPRA Fact Sheet released November 28, 2025.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) attributes the low output to technical constraints, crude supply limitations, and repeated downtime at state-owned refineries, highlighting a stark gap between ambition and reality in Africa’s oil giant.
Current Refining Landscape: Only 4 Active Facilities
Of Nigeria’s 10 refineries (conventional + modular), just four are operational with a combined 467,000 bpd capacity:
- Dangote Refinery (Lagos): 650,000 bpd installed; processed 449,000 bpd in October (69% utilization). The $20bn mega-plant, Africa’s largest, relies increasingly on U.S. imports amid domestic crude shortages.
- Aradel Refinery (Ogbele, Rivers): 11,000 bpd modular.
- Edo Refinery (Benin): 1,000 bpd modular.
- Waltersmith Refinery (Imoturu, Rivers): 5,000 bpd modular.
State-owned giants like Port Harcourt (210,000 bpd installed), Warri (125,000 bpd), and Kaduna (110,000 bpd) remain largely offline despite rehabilitation efforts.
Licensing vs. Reality: 47 Approved, Only 4 Running
Since 2000, NMDPRA has issued 47 Licences to Establish (LTEs) for refineries totaling 1.752 million bpd, and 31 Licences to Construct (LTCs) for 1.228 million bpd. Yet, only three are under construction:
- Waltersmith Train 2: 5,000 bpd expansion.
- AIPCC: 30,000 bpd.
- Azikel: 12,000 bpd.
The LTEs include the six operational private refineries (Aradel, Edo, Waltersmith, Duport, OPAC, and Dangote) and the 31 at construction stage.
The Core Issue: Crude Supply Shortfalls
Private refiners, including Dangote, cry foul over inadequate domestic crude. The Petroleum Industry Act (PIA) mandates upstream firms supply 60% of production to local refiners, but operators like CORAN’s Eche Idoko say it’s not enforced:
“I cannot set up a 20,000 bpd refinery and get only 5,000 bpd. How do I repay investors?”
Dangote processed 449,000 bpd in October (vs. 650,000 capacity), increasingly importing from the U.S. CORAN Vice-Chairman Dolapo Okulaja echoed: “The differential is too much for refiners to bear.” CORAN President Momoh Oyarekhua blamed PIA’s “willing buyer, willing seller” clause conflicting with supply obligations.
Path Forward: Regulatory Overhaul Needed
NMDPRA vows intensified oversight to boost utilization and imports reduction. But refiners demand feedstock guarantees and single-digit loans to scale. Without resolution, Nigeria’s $10B+ fuel import bill persists—despite 200,000 bpd crude production.
The refining paradox: Licenses abound, but crude doesn’t flow. Time for action.
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