Nigeria’s petroleum refining industry is preparing for another phase of expansion, as seven additional modular refineries are expected to commence operations in 2027, bringing a combined processing capacity of 83,000 barrels per day into the country’s downstream sector.
The projected development could significantly increase local refining capacity at a time when Nigeria is adjusting to changing petroleum supply patterns, rising domestic production and declining fuel consumption. It also reflects growing interest in smaller refining facilities that can complement larger industrial plants and strengthen the country’s ability to process crude oil locally.
George Maher-Bonnett of Argus Media disclosed the projection during the OTL Africa Downstream conference in Lagos on Wednesday, October 28, while presenting an assessment of developments in Nigeria’s petroleum products market.
His presentation, titled African Energy Outlook, showed that four modular refineries were operating in Nigeria as of September 2026, with a combined processing capacity of 32,000 barrels per day. The seven proposed facilities would therefore introduce more than twice the capacity currently provided by those four plants.
Seven Projects Could Increase Nigeria’s Modular Refining Capacity
The proposed expansion represents an important development for modular refineries Nigeria, particularly as the country continues to encourage investments in domestic petroleum processing.
Based on the figures presented by Maher-Bonnett, the seven additional plants could raise the combined capacity of the country’s modular refining sector from 32,000 barrels per day to approximately 115,000 barrels per day, provided all the projects commence operations as projected.
However, the presentation did not disclose the identities of the seven facilities, their owners or their proposed locations. It also did not provide individual processing capacities or specific commissioning schedules, meaning that further details will be necessary to establish the progress of each project.
Modular refineries generally operate on a smaller scale than conventional large refineries and can process crude oil into products such as petrol, diesel and kerosene, depending on their configurations and available processing units.
Their expansion could create additional opportunities for domestic investors, engineering companies, crude suppliers and petroleum distribution businesses, while supporting the development of infrastructure around Nigeria’s oil-producing communities.
Nevertheless, the successful operation of these facilities will depend on several factors, including access to crude oil, reliable infrastructure, financing, regulatory approvals and the ability to maintain consistent production after commissioning.
Dangote Refinery Continues to Influence Domestic Supply
The expected arrival of the seven facilities comes as the Dangote Petroleum Refinery continues to influence Nigeria’s petroleum products market through its growing contribution to local production.
Maher-Bonnett described the 700,000-barrel-per-day refinery in Lekki, Lagos State, as operating at a high rate, with steady petrol output supporting the country’s improving level of self-sufficiency in refined petroleum products.
The facility represents a major change in Nigeria’s traditional fuel supply structure, which relied heavily on imported products despite the country’s position as one of Africa’s leading crude oil producers.
With increased domestic refining, Nigeria has greater opportunities to meet local petroleum demand through locally processed products rather than depending entirely on overseas suppliers. However, domestic production does not automatically eliminate imports, as supply levels, product specifications, pricing and distribution requirements continue to influence market activity.
The seven proposed modular refineries could provide additional processing capacity alongside the Dangote facility and existing smaller plants, although their actual contribution will depend on how much crude they can secure and the volume of finished products they deliver to the market.
Fuel Demand and West African Trade Patterns Change
Maher-Bonnett’s presentation also highlighted a decline in Nigerian fuel demand during 2026, identifying higher petroleum product prices as one of the factors influencing consumption.
The development reflects the changing conditions in the downstream market, where consumers and businesses continue to adjust their spending and fuel usage in response to prevailing prices.
In addition, increased domestic refining is changing the economics of petroleum products trading between Europe and West Africa. According to the presentation, steady petrol production from the Dangote refinery has reduced the commercial attractiveness of importing some refined products from European markets.
Ghana is also recording developments in its refining industry, with the 45,000-barrel-per-day Tema refinery increasing production as the country works to improve its domestic petroleum supply.
These developments indicate that West African countries are gradually increasing their refining activities, potentially changing established regional trading relationships and the movement of petroleum products across international markets.
For Nigeria, the projected commissioning of seven additional modular refineries in 2027 could further strengthen its position in the regional energy industry. However, achieving that outcome will require the proposed facilities to move beyond projected capacity and establish sustainable commercial operations.
If all seven projects meet their expected timelines, they could add 83,000 barrels per day to Nigeria’s modular refining capacity and expand the country’s domestic petroleum processing base.
