Africa’s richest man, Alhaji Aliko Dangote, yesterday shocked the oil world when his 650,000 barrels per day refinery, Dangote Oil Refinery, and Petrochemical Limited, was unveiled at Ibeju-Lekki, Lagos State yesterday.
Unveiling the project, President Muhammadu Buhari said that the Dangote Group has helped to transform Nigeria’s economy from heavy import dependence to a net exporter in some critical industries including cement and fertiliser.
*Buhari says plant is game changer for Nigeria’s economy
He described the feat as a significant milestone for Nigeria’s economy and a game changer for the downstream petroleum products market in the entire African region.
The inauguration was witnessed by Heads of State from Ghana, Togo, Niger, Senegal and a representative of the President of Chad, and captains of industry, among others.
He expressed delight in commissioning this new Greenfield Dangote Oil Refinery and Petrochemical complex, recalling that about a year ago, he was at the complex to commission the new fertiliser plant and even inspected the refinery complex-then under construction.
He said the refinery is expected to enable Nigeria to achieve self-sufficiency in refined products and even have a surplus for export.
According to him, “This mega industry we are commissioning today is a clear example of what can be achieved when entrepreneurs are encouraged and supported and when an enabling environment is created for investments and for businesses to thrive.
“I am confident that my successor, His Excellency Asiwaju Bola Ahmed Tinubu, will sustain the improvement in our economic and business environment and strengthen the framework of our public-private partnership policies to accelerate the pace of our economic growth and development. I am happy to leave our economy in very competent hands,” he said.
The President, who commended Alhaji Aliko Dangote’s leadership in executing the 650,000 barrels per day refinery, urged other entrepreneurs to emulate his example in driving economic growth and realising Nigeria’s economic potential.
He stressed the need for African countries to come together, integrate their economies, eliminate trade barriers, and rally their populations to achieve Agenda 2063 for the continent’s prosperity.
“I urge and encourage our other great entrepreneurs to emulate this iconic Nigerian industrialist and join the government in accelerating our growth to realise our globally recognised economic potential.
“When I travel around Africa and meet and engage my brother Heads of State (and I am delighted some of their Excellences are here) I often sense a quiet expectation that our country is blessed with resources and human capacity to lead Africa’s rise to economic prosperity and the attainment of Agenda 2063 – ‘The Africa we all want.’
“But to achieve the goals of Agenda 2063, Africa must come together – we must integrate our economies, eliminate trade barriers and energize our youthful population to scale up our production capacity.
“We must create necessary conditions for our private sector to grow and partner with the public sector to accelerate economic growth across the continent.
“We must not allow outside powers to use some of our leaders to destabilize our economic and political trajectory,” he said.
Buhari acknowledged that Nigeria’s economy has faced significant challenges over the years, including deficits in economic infrastructure, insurgency, and external crises such as the Global Financial Crisis, oil price collapses, the COVID-19 pandemic, and the Russia-Ukraine war.
“The consequence of these challenges constitutes a severe strain on our economy, limiting Government’s ability to provide basic infrastructure without resorting to huge borrowings.
“Our Government, therefore, decided to focus attention on creating an enabling environment for the private sector to thrive and fill the enormous gap in investments not only in infrastructure but also in all critical sectors.
“We recognise that without the active participation of the private sector and a strong commitment to a public-private partnership, our economy would continue to remain severely challenged and our economic growth impeded.
“Government, therefore, will and should continue to provide an enabling environment and encourage innovative public-private partnerships in all sectors of our economy,” he said.
The President emphasised the administration’s commitment to this approach, citing Executive Order 007 of 2019 which facilitated the rehabilitation/construction of many roads by private sector investors using a Tax-credit scheme.
*First fuel products ready in June 2023- Dangote
Meanwhile, the Dangote Group has pledged that the first fuel products from the Dangote Refinery will be ready by June 2023.
Chairman of the Group, Dangote, who disclosed this during yesterday’s commissioning of the refinery, commended Buhari for his support through the arduous process that has seen the birth of the Dangote refinery.
According to Dangote, the Nigerian National Petroleum Company (NNPC) Limited has pledged its support for the refinery operations.
The Dangote refinery is also targeting 40 per cent of its products’ output for exports.
Dangote emphasised the refinery’s role in fulfilling the group’s corporate vision of promoting self-sufficiency and global competitiveness.
“’We have built a refinery with a capacity to process 650,000 barrels per day (plus 900,000 tonnes of polypropylene) in a single train– which is the largest in the world. We have selected the best plants and equipment and the latest technologies from across the world.
“Our products slate is designed to meet the highest quality standards and high-value products including Premium Motor Spirit (PMS), Automotive Gas Oil (Diesel), Aviation Turbine Kerosene (ATK); all of Euro V Standards that will enable us not only meet our Country’s demand but also to become a key player in the African and global market.
“’Our coastal location and offshore loading and offloading (SPM) facilities with a capacity to receive all our crude oil supplies and evacuate up to 75 per cent of our liquid products give us direct access to the rest of Africa and the global market for exports. In addition, 80 per cent of our production can be discharged through trucks nationwide.”
He disclosed that the huge investment of over $18.5bn in this industry was prompted by the company’s desire to support and contribute its quota to the Federal Government’s sustained effort to transform the economy and reposition Nigeria as the leading nation in Africa, and a respected member among emerging economies in the world.
According to him, apart from ensuring a consistent supply of high-quality fuels for the transportation sector, the refinery will provide essential raw materials to a wide range of manufacturing sectors, including plastics, pharmaceuticals, food and beverages, packaging, construction, and more.
He further stated that the refinery’s operation and related businesses would generate a substantial number of job opportunities, while the downstream supply and distribution of its products would significantly contribute to the absorption of labour, potentially benefiting hundreds of thousands of individuals.
“Once our plant is fully on stream, we expect that at least 40 per cent of the capacity will be available for export and this will result in significant Foreign Exchange inflows into the country.
“Overall, we are committed to operating our Plant in line with international best practice requirements, recognising the importance of protecting the environment, and putting in place stringent environmental, health, and safety policies to ensure that the Refinery operates safely and sustainably,” he said.
Dangote said the President has been a great support system.
“At times when I felt like giving up, your confidence and quiet words of assurance have been the difference. Mr President, I want to thank you from the bottom of my heart for this encouragement and for making sure that this project is possible,” he said.
“Since the beginning of this democratic dispensation, the Lagos state government has been exceptionally remarkable in its commitment and support for the private sector,” Dangote added.
In his industry address, the Group Chief Executive Officer of the Nigerian National Petroleum Company (NNPC) Limited, Mele Kyari said the refinery commissioning is a defining moment for the Nigerian energy industry, noting that energy is not just a business but a vital component of national security.
“The benefits will be real and tangible for consumers as well as the economy and the country more generally. This remarkable achievement is not taking place in a vacuum, this extraordinary facility that we see here today is not standing alone, but with the enabling environment that our government continues to provide and we are most grateful for this.
“The reforms that we have undertaken in the Nigerian petroleum industry under the leadership of President Muhammadu Buhari were built around a clear set of principles that anticipate the tremendous changes that will take place in the international energy market in the decades to come.
“NNPCL will continue to support investment in domestic refining to satisfy the growing demand for refined petroleum products in both local and regional markets as against simply exporting crude to diminishing markets overseas.
“The Dangote Refinery with the new deal that we have been building, supported by the enabling Petroleum Industry Act (PIA), will surely provide domestic security of supply in our country. The lingering challenges of petroleum subsidies are getting out of the capacity of the state to bear and the differentials that domestic refining will provide are insignificant and cannot compensate for the subsidies,” he said.
CBN pegs cost of building at $18.5bn
The Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, reaffirmed that the cost for the construction of the Dangote Petroleum Refinery was $18.5bn.
This amount is significantly higher than the $9bn Africa’s richest man, Aliko Dangote, mentioned when he set out to build the refinery in 2013.
Dangote accounted for 50 per cent of the capital investment, while he secured the remaining 50 percent from local and foreign deposit money banks (DMBs) through debt finance.
Between 2013 and 2023 period, the businessman’s total net worth dropped from $25bn to $13.6bn, according to data obtained from Forbes Billionaires’ Index.
Emefiele, who spoke at the commissioning of the 650,000 barrels per day refinery in Lagos, however, said the total outstanding debt had dropped from $9bn to $2.7bn after Dangote Group paid part of the loans before the refinery was commissioned.
He said, “The commercial loan component of the project was financed by domestic banks with the balance from foreign banks.
“I am delighted to announce that the Dangote Group paid down some portion of commercial loans before the refinery’s commissioning. As of today, total loans outstanding have dropped from over $9 billion to $2.7bn.”
*Sanwo-Olu commends Buhari, Tinubu, Dangote for Nigeria’s first private refinery
Lagos State Governor, Mr Babajide Sanwo-Olu, said the stories of President Buhari; President-elect, Asiwaju Bola Tinubu, and Chairman of Dangote Group, Aliko Dangote are a testament that prosperity can be achieved when leaders have a shared vision for the people they are leading.
Sanwo-Olu said the three leaders have shown Nigerians that leadership is about consistency and commitment to Nigeria’s economic growth.
He said, “The vision of Aliko Dangote, President Muhammadu Buhari, and incoming President Asiwaju Bola Ahmed Tinubu, is a story of possibility when men have a shared common vision, purpose and they have the possibility that things can happen, things can change and things can be prosperous for the people they are leading.
“These three men; Aliko Dangote, President Muhammadu Buhari, and President-elect Bola Ahmed Tinubu epitomise all the great qualities of great leadership. They have shown us that nothing can be something.
“They have shown us that leadership is about consistency. It is about showing that whatever it is that you believe in, give it all it takes and at the end of it you will see the results coming out.”
Sanwo-Olu, while commending Dangote, said the business mogul is a completely detribalised Nigerian who has impacted many lives positively.
*African Presidents applaud project
Meanwhile, the Presidents of Ghana, Niger, Senegal, Togo, and Chad yesterday hailed the Chairman of the Dangote Group for the establishment of the Dangote Petroleum Refinery and Petrochemical Plant.
The leaders, who joined their Nigerian counterpart, Buhari, at the inauguration, said the refinery which is one of the biggest in the world will make Africa better and stronger.
“This spectacular project, the Dangote Refinery and Petrochemical Complex makes West Africa better and stronger. And I congratulate this distinguished patriotic son of Africa for the sheer brilliance of this initiative,” said Ghana’s President Nana Akufo-Addo.
Senegal’s President Macky Sall, who also spoke on behalf of Togo’s President, Faure Gnassingbe, said that the Dangote refinery project will improve access to electricity for Africans many of whom still have no electricity access.
“This great investment will inspire respect and admiration here in Nigeria, the most populous country on our continent. The Dangote Group is certainly helping to reduce the challenge of universal access to electricity and allowing industrialising our continent,” Sall said.
President of Niger Republic, Mohamed Bazoum also corroborated what his colleagues said, thanking Dangote for the project.
