What factors are responsible for Nigeria’s crude oil processing capacity outstripping its excess production capacity outside contractual export?
Share
Sign up to read and add specific questions and answers about Africa. Enjoy it!
Sign up to read and add specific questions and answers about Africa. Enjoy it!
Hello! You can sign up to add your knowledge through questions or answers.
Lost your password? Please enter your email address. You will receive a link and will create a new password via email.
Please briefly explain why you feel this question should be reported.
Please briefly explain why you feel this answer should be reported.
Please briefly explain why you feel this user should be reported.
What factors are responsible for Nigeria’s crude oil processing capacity outstripping its excess production capacity outside contractual export?
To clarify, if Nigeria's crude oil processing capacity exceeds its excess production capacity outside contractual exports, it means that Nigeria is processing more crude oil domestically than it is exporting beyond its contractual obligations. Several factors can contribute to this situation: 1. DomRead more
To clarify, if Nigeria’s crude oil processing capacity exceeds its excess production capacity outside contractual exports, it means that Nigeria is processing more crude oil domestically than it is exporting beyond its contractual obligations. Several factors can contribute to this situation:
1. Domestic demand: Nigeria may have a significant domestic demand for petroleum products such as gasoline, diesel, and jet fuel. If the country’s industrial and transportation sectors require a substantial amount of refined petroleum products, it would necessitate higher domestic refining capacity to meet this demand.
2. Infrastructure limitations: Nigeria may face challenges in exporting its crude oil due to limitations in transportation infrastructure, such as pipelines or export terminals. These limitations can restrict the country’s ability to export its excess production and may lead to a higher proportion of crude oil being processed domestically.
3. Economic considerations: Processing crude oil domestically can provide economic benefits, such as job creation, increased revenue through the refining and marketing of petroleum products, and reduced dependence on imported refined products. Nigeria may prioritize developing its domestic refining industry to derive these economic advantages.
4. Value addition: By processing crude oil domestically, Nigeria can add value to its natural resources. Instead of exporting raw crude oil, which tends to fetch lower prices compared to refined products, the country can capture a greater share of the value chain by refining the oil and exporting higher-value petroleum products.
5. Strategic considerations: Nigeria may have strategic reasons to prioritize domestic refining capacity. It can enhance energy security by reducing reliance on external sources for refined petroleum products. Additionally, having a robust domestic refining sector can provide stability and resilience to the country’s energy infrastructure in case of disruptions in global oil markets.
See lessI will respond with a question, did Nigeria stop fuel subsidy so it will import crude oil?
I will respond with a question, did Nigeria stop fuel subsidy so it will import crude oil?
See lessWell, it is arguable whether the oil subsidy regime is still on or not. President Tinubu has not proven himself on that.
Well, it is arguable whether the oil subsidy regime is still on or not. President Tinubu has not proven himself on that.
See less