Aradel to launch new petrol refining at modular facility

Aradel Holdings Plc is preparing to begin gasoline production at its modular refinery in 2027, following the removal of Nigeria’s fuel subsidies and improved market conditions that have made domestic petrol refining more commercially viable.

Temitayo Ogunbanjo, who oversees Aradel’s refining business, said the deregulation of the fuel market has created a clearer path for the company to manufacture gasoline at its 11,000-barrel-per-day plant. The facility currently produces kerosene, diesel, gas oil and naphtha.

Aradel is also evaluating options to expand the refinery’s capacity, secure additional crude supplies and improve export logistics. The company is considering investments in aviation fuel, which has become an important export product to European markets.

Nigeria ended its long-standing petrol subsidy in 2023. The policy shift removed government price controls that had kept pump prices artificially low but discouraged domestic refining. According to Ogunbanjo, the new market environment has significantly improved the economics of gasoline production for independent refiners such as Aradel.

Upstream Production Surges

Aradel’s upstream operations recorded sharp growth in the first half of 2026. Average daily crude production rose 258% year-on-year to 55,600 barrels per day, up from 15,500 barrels per day in the same period of 2025.

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Gas output increased even more dramatically, climbing 1,121% to 503.2 million standard cubic feet per day from 41.2 million cubic feet per day a year earlier. The company attributed the gains to improved pipeline availability and sustained customer demand.

Refinery Output Recovers in Second Quarter

Refined product output for the first half of 2026 totalled 126.2 million litres, a 22% decline from 161.4 million litres in the corresponding period of 2025. The drop was largely due to constrained crude supply and unplanned downtime in the first quarter.

Production rebounded in the second quarter, reaching 67.5 million litres — 15% higher than the 58.7 million litres recorded in the first quarter.

The stronger oil and gas production, combined with improved refinery performance in the second quarter, helped drive first-half revenue to ₦2.49 trillion.

Aradel’s plans to add gasoline production and explore further expansion underscore the growing role of modular refineries in Nigeria’s post-subsidy energy landscape, as independent operators seek to capture more value from domestic crude and meet local and export demand.