- Dangote unveiled the Dangote Petroleum Refinery in Ibeju-Lekki, Lagos, on May 22, 2023
Aliko Dangote, President of the Dangote Group, is strategizing to establish an oil trading firm in London, aiming to manage crude and product supply for his new 650,000 barrel-per-day refinery in Lagos, Nigeria.
This move is expected to reshape global oil and fuel flows, drawing close attention from the trading community.
Dangote unveiled the Dangote Petroleum Refinery in Ibeju-Lekki, Lagos, on May 22, 2023. The initiative is anticipated to diminish the influence of major trading firms, such as BP, Trafigura, and Vitol, which have been in talks to provide financing and crude oil in exchange for product exports.
Despite negotiations with these firms, Dangote remains cautious about relinquishing control of the project and potential profit. State-backed firms have also been engaged in Dangote’s pursuit of funding and crude resources.
“He is going to try and do it himself,” an industry source told Reuters.
Sources told Reuters the new trading team will be led by ex-Essar trader, Radha Mohan.
Mohan joined Dangote in 2021 as director of international supply and trading, according to his Linkedin profile.
Two sources said the team was in the process of hiring two new traders.
Reuters report further stated that “the Lagos refinery took nearly a decade to complete and it came in at a cost of $20bn, some $6bn over budget.
“The plant has refined around 8m barrels of oil between January and February and will take months to get to full capacity.
“So far, Vitol has prepaid for some product cargoes to help the refinery buy crude, while Trafigura has swapped some crude oil in exchange for future fuel cargoes, sources with knowledge said. Geneva-based Vitol and Trafigura declined to comment.”