Difficulties experienced by Nigeria's new Dangote Oil Refinery in securing a letter of credit (L/C) may have left a shipment of US crude oil stranded offshore Nigeria for over a month.

But Dangote has dismissed reports that it is finding it difficult to obtain L/Cs, saying the supertankercarrying the shipment is still at anchor because a deal has yet to be struck between the refinery and the cargo's owner.

Anchored offshore

Since 28 March the Greek registered Maran Mira has been anchored offshore Lagos with a 2-million-barrel cargo of West Texas Intermediate cargo owned by Chinese energy giant PetroChina.

The oil transaction between PetroChina and Dangote has been delayed due to the refinery's failure to furnish an L/C to the Chinese trader according to a source familiar with the matter cited by the Reuters news agency.

It reports the refinery having difficulty accessing US dollars through the Nigerian government, with the naira's slide against the US dollar and rising global oil prices.

Dangote's denial

But according to local media, Dangote group executive Edwin Devakumar disputes this version of events, claiming the refinery bears no responsibility for the delay which he attributes to ongoing negotiations between the two parties to agree sale prices and credit terms.

Oil marketers in Nigeria are already in the process of securing L/Cs to buy petroleum products from the newly constructed Dangote Oil Refinery which is expected to be Africa's biggest oil refinery and the world's biggest single-train facility (DC World News, 5 April 2024).

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.