Nigeria’s Dangote Group is set to shake up the Caribbean tanker market with a new terminal project.
Fresh from launching Africa’s biggest refinery near Lagos this year, tycoon Aliko Dangote has said he is planning a facility to export petroleum products into North America.
He told an industry conference in the Bahamas that a new terminal would be able to get oil on tankers to northern ports in 18 to 20 days, according to domestic media and analytics company Kpler.
Dangote said he would sign a bilateral agreement in the region to build the facility.
He gave no details of where the terminal would be sited.
But was quoted by the Leadership daily as saying: “I know the price in the Caribbean in terms of petroleum products is very high. We produce it cheaply. We can always bring it here. We can set up a terminal and we’ll be able to fix their needs.”
“Once we set up a terminal, they will have very cheap oil. They will have cheap energy. And by having cheap energy, their own economy will grow faster,” Dangote said.
The 690,000-barrel-per-day refinery in Nigeria has already been exporting products to African countries, Europe and the Americas.
Dangote’s comments suggest more long-haul cargoes heading across the Atlantic from West Africa.
UK shipbroker Gibson has said that the long-awaited tanker market change due to the refinery’s start-up appears to be approaching, but it might not be quite what the sector is expecting.
Dangote imported its first crude cargo last December, and over the past three months, imports averaged between 230,000 bpd and 310,000 bpd, mainly consisting of Nigerian grades, supplemented by US barrels.
Demand to be cut for LR and MR ships?
In March, clean and dirty cargoes were exported for the first time. Kpler said volumes reached 290,000 bpd that month.
As Nigeria ships in fewer product cargoes, demand will be cut for LR and MR product carriers.
“Faced with reduced trading opportunities in the West, this will inevitably increase Middle East LR availability,” the UK broker said.
On the flipside, Dangote’s diesel and jet fuel could find a natural home in Europe, the company believes.
But it warned: “Although it will create ‘new’ clean tanker tonne-miles, many of these barrels will be a backhaul cargo into Europe for tankers that will continue to move products into the rest of West Africa, so essentially not adding much new vessel demand.
