Fire contained at $20-billion refinery of Africa’s richest man Aliko Dangote

Timilehin Adejumobi -

Key Points:

  • Fire broke out at Dangote Oil Refinery’s effluent treatment plant early Wednesday; operations continue as usual with no injuries reported.
  • Refinery faces potential delays due to a crude oil shortage, potentially pushing its petrol market debut to between August and December.
  • Edwin Devakumar accuses International Oil Companies of sabotaging the Dangote Refinery project, further complicating crude supply issues.

Fire broke out at the effluent treatment plant of the Dangote Oil Refinery, Africa’s largest oil refinery, early Wednesday morning. The refinery, owned by Aliko Dangote, the continent’s richest person, continues to operate as usual with no injuries reported.

Group Chief Branding and Communications Officer for Dangote Industries Limited Anthony Chiejina confirmed the incident in a brief statement. “We have swiftly contained a minor fire incident at our effluent treatment plant (ETP), today Wed., June 26,” he said.

Refinery faces potential delays due to crude oil shortage

Despite the fire incident being contained, the refinery is experiencing challenges that may delay its highly anticipated July debut in the petrol market. Industry sources reveal a shortage of available crude oil, jeopardizing the refinery’s ability to meet its initial production targets.

“The refinery hasn’t received the crude volumes required to refine petrol for the July launch,” disclosed an oil trading industry source. Jide Pratt, country manager of Trade Grid, added, “The crude supply issue remains unresolved, and pricing for premium motor spirit (PMS) in USD is undecided, adding complexity.”

Pratt in a similar manner as several industry experts estimates that the launch could be postponed to between August and September, with a worst-case scenario pushing it back to December.

IOCs accused of Sabotage

The Dangote Refinery, located in Lekki, Lagos, has a capacity of 650,000 barrels per day (bpd) and aims to reduce Nigeria’s reliance on imported petrol. However, the Nigerian National Petroleum Company (NNPC), which holds a 20 percent stake, was expected to be a primary crude supplier but appears unable to fulfill this role.

In a 2023 interview, Edwin Devakumar, vice president of Dangote Industries Limited, indicated that the NNPC had already committed its crude to other entities. Earlier this week, Devakumar accused International Oil Companies (IOCs) operating in Nigeria of sabotaging the project.

Despite setbacks, the Dangote Oil Refinery remains a significant project in African energy with advanced environmental sustainability measures like recycling processed water, generating power from waste heat, and employing carbon capture technologies. It also features a polypropylene plant and two large fertilizer trains, showcasing its industrial capability.