Dangote Oil Refinery Targets 50% Products For Export Market

African richest man Aliko Dangote’s gasoline refinery currently under construction in Lagos, Nigeria’s economic nerves centre has the capacity to export over 50 per cent of its products when completed and also meet all domestic demand for fuel, a senior executive of the firm has disclosed.
“Our primary focus is Nigeria, to meet the entire local demand, but we have the capacity to export more than 50 per cent of what we produce, so the secondary focus will be on western Africa and central Africa,” said Devakumar Edwin, Dangote Group Executive Director.
Nigeria, Africa’s biggest crude oil producer, imports almost all of its fuel consumption as a result of the weak performance of its four refineries.
Expectations are high that when the Dangote refinery come on stream, it will end both the huge foreign currency spent in importing fuel and the perennial scarcity.
The oil refinery, with a capacity of 650,000 barrels per day, is expected to come on stream by the first quarter of 2019, with the first phase up by December, Edwin said.
Edwin said the first phase of the 1.5 million tonne capacity fertiliser plant, on the same Lagos state site, would be completed in September and start operating in December. The second line, also 1.5 million tonnes, will start four months later, he added.
The refinery and petrochemical complex located on 25,000 hectares of swampy land includes a jetty to ferry products by sea within Nigeria and abroad and an undersea pipeline to transport gas.
Dangote will consider listing the oil refinery once it comes on stream, Edwin added.
The oil refinery will account for half of the Dangote Group’s assets when it is finished next year, according to the executive director.
Dangote has built his fortune on cement, although his sprawling business empire also spans flour milling, agriculture and real estate.
With the building of the world’s largest single oil refinery and also expansion into fertiliser, aiming to address long-standing problems in Nigeria’s energy markets, the conglomerate has successfully diversified its asset base and heading to dominate the local bourse.
Dangote Cement, Nigeria’s biggest listed company, has attracted investment from Dubai and South African sovereign funds. It posted a 2017 profit of 289.6 billion naira ($920.8 million), up 60 per cent on 2016, and is valued at $4 billion.
Edwin said the company had held talks with firms including Vitol and Shell over the supply of crude and lifting of petroleum products for sale abroad.
The Dangote refinery will be able to process different grades of crude including shale oil.
The company is borrowing $3.3 billion for the project, arranged by Standard Chartered Bank. The remainder will be funded by equity and through export agencies, Edwin said.
Dangote has also acquired two oil fields in Nigeria from Shell to help supply the refinery.
Source: Reuters

Leave a Reply

Your email address will not be published. Required fields are marked *