“Refinery Struggles End? Dangote Drills Its Own Crude, Tightens Grip on Nigeria’s Fuel Supply Chain”
......As Dangote Launches Niger Delta Oil Production, Eyes 15,000 bpd to Fuel Refinery Operations
By Passman Akpos
In a major step toward energy self-sufficiency, Dangote Group has commenced crude oil production from its upstream assets in the Niger Delta, marking its official entry into Nigeria’s oil exploration and production space.
The company confirmed it has successfully recorded its first oil and is now advancing toward full-scale commercial production from the Kalaekule field, with output projected to reach 15,000 barrels per day (bpd) in the coming weeks.
Speaking in an interview with S&P Global’s Platts, Devakumar Edwin, Vice-President of the Dangote Group, revealed that initial well testing is already underway.
“We have opened a well and begun standard testing, which should be completed in the next three to four weeks maximum,” Edwin said. “After that, oil can be pumped in larger volumes, and drilling of additional wells will begin.”
Also confirming the development, Olajumoke Ajayi, CEO of Dangote’s upstream joint venture West African E&P (WAEP), disclosed that current production from the Kalaekule field stands at about 4,500 bpd following its long-delayed start-up in December 2025.
“Output is expected to ramp up to 15,000 bpd within the next month,” she said.
Dangote holds an 85 percent stake in the upstream venture, while WAEP maintains a 45 percent working interest in Oil Mining Leases 71 and 72. The remaining stake is shared with Nigerian National Petroleum Company Limited, while First E&P serves as the asset operator.
The oil fields—located in shallow waters approximately 22 kilometres from the Bonny Export Terminal—were originally discovered in 1966 and once peaked at 21,000 bpd in 1999 before declining in the early 2000s.
David Bird, CEO of the Dangote Refinery, emphasized that the upstream push is expected to significantly improve crude supply reliability for the refinery, which has faced sourcing challenges in recent months.
“Alongside upstream investments, the company is exploring its own shipping operations to reduce logistics costs and ensure steady crude delivery,” Bird stated. “With indigenous production and Dangote-owned vessels, the refinery could achieve a fully integrated and dependable supply chain.”
He added that crude from the new fields would be supplied to the refinery “if commercially viable,” noting that joint venture partners would focus on maximizing value from production.
The development is seen as a strategic move to close supply gaps that have impacted refinery throughput. Earlier this month, Nigerian National Petroleum Company Limited disclosed plans to increase crude allocations to Dangote Refinery, with seven cargoes scheduled for May—up from five in previous months.
Industry analysts say Dangote’s entry into upstream production could reshape Nigeria’s oil value chain, strengthening local capacity while reducing dependence on external crude sourcing.
