Key points:
- Despite being advised against it, Dangote pursued his refinery project, determined to prove naysayers wrong.
- No new refineries have been built in Africa in 35 years due to financial constraints, political will, and opposition from import beneficiaries, he said.
- Dangote emphasized that Africa must develop itself rather than waiting for foreign investors, focusing on industrialization and connectivity.
Aliko Dangote, Africa’s richest man, chairman of Dangote Group, and the continent’s most diversified manufacturing conglomerate, has shared insights into his refinery project. Despite facing significant warnings and challenges, Dangote pursued the project, driven by a determination to prove naysayers wrong.
Dangote, a 67-year-old billionaire, admitted that he was advised against embarking on the refinery project. He believed that the warnings were attempts to discourage him. Reflecting on the difficulties he encountered, Dangote explained that had he known the extent of the challenges, he might not have ventured into the project.
“If I’m going to do this now, I’m going to do it better because I’ve learnt from experience. But if I knew what I was going to go through, I wouldn’t have tried it. People warned me about going into this, but I thought they were only trying to discourage me.” he said.
Dangote highlighted the broader challenges faced by African countries in building refineries. He noted that no new refineries had been established in the past 35 years due to financial constraints, lack of political will, and opposition from those benefiting from the importation of petroleum products.
“There has not been a refinery in the last 35 years, and the reasons are money, political will, and also people who are benefiting from this whole stuff of importing petroleum products into Africa are actually discouraging those governments from building a refinery. They (the governments) won’t get the loans anyway because they don’t have strong banks; the international banks would not support anything like this,” he highlighted.
Dangote noted the importance of self-reliance in Africa’s development. He stated that Africans must take charge of their own development rather than waiting for foreign investors.
“If Africans are waiting for foreign investors to come and develop Africa, it will never happen,” Dangote asserted. He believes that focusing on industrialization and connectivity within Africa is key to the continent’s progress.
Dangote unveiled his plans for the refinery in September 2013, announcing that he had secured approximately $3.3 billion in financing for the project. Initially estimated to cost around $9 billion, with $3 billion invested by the Dangote Group and the remainder through commercial loans, the refinery was expected to begin production in 2016.
However, a change in location to Lekki delayed construction, which started in 2016 with excavation and infrastructure preparation. The planned completion was subsequently pushed back to late 2018.
The refinery was commissioned in May 2023 under the administration of former President Muhammadu Buhari. It is anticipated to enable Nigeria to achieve self-sufficiency in refined products and create a surplus for export, significantly impacting the country’s economy and reducing its dependence on imported petroleum products.
The facility boasts not only as a world-class refinery, but also a polypropylene plant churning out 1 million metric tonnes annually and two of the biggest fertilizer trains in existence, with a combined capacity of 3 million tonnes of urea per year. It boasts a closed-loop process water system, generating 50MW of clean power through waste heat recovery.
The plant produces cleaner Euro-V standard fuels, and leverages advanced carbon capture technology to minimize CO2 emissions. Additionally, it mitigates the environmental impact of transporting crude oil by sea, though the specific methods employed are not disclosed. Boasting the world’s largest single-train capacity (650,000 barrels per day), the $20.5-billion refinery visions to become a major exporter of refined products across Africa, with a potential reach as far as Brazil.
In a recent update on the refinery’s production capabilities, Dangote announced that by June, the facility would begin producing diesel and gasoline. The refinery also plans to procure 24 million barrels of crude oil from the United States over the next year, underscoring its global operational scale.
Dangote, whose net worth stands at $15 billion, highlighted the pivotal role of recent restructuring efforts and strategic leadership appointments within the conglomerate.
“We have divided the company now into two. We have myself as group president, then we have the group president, oil and gas and we have the group president of other businesses,” he said. “And all these ones, when you combine, by the end of this year, we will have a group that will have $30 billion of revenues and that is big. It means that we will be among the biggest 120 companies in the world.”
Billionaires.Africa reported that, the Dangote Oil Refinery has commenced jet fuel exports to Europe, with its maiden consignment setting sail for Rotterdam, Netherlands. Furthermore, the refinery has announced plans for a dual listing on the London Stock Exchange (LSE) and the Nigerian Exchange (NGX), underscoring its ambition to drive Nigeria’s industrial development while solidifying its position in the global oil and gas market.
Dangote Group’s initiatives not only signify a significant leap forward for Nigerian industrial development but also hold promise for Africa’s economic landscape. As operations continue to expand and evolve, the conglomerate stands poised to leave an indelible mark on the global oil and gas industry, reaffirming Africa’s potential for economic growth and self-sustainability.
With its visionary leadership, strategic investments, and commitment to innovation, Dangote Group remains at the forefront of Africa’s industrial revolution, poised to reshape the continent’s economic landscape and establish itself as a global powerhouse in the years to come.
Dangote’s refinery project represents a monumental effort to industrialize Africa and underscores his belief in the continent’s potential to drive its own development. His experiences and insights provide valuable lessons for future industrial ventures in Africa.
