Founder Aliko Dangote said that the much-awaited project would start with 350,000 barrels per day next month, but in the meanwhile, Dangote Refinery has secured its first cargo contract of almost 6 million barrels, ready for delivery.
The refinery is anticipated to change the landscape of oil trade in the Atlantic Basin by eliminating a profitable market for fuels produced in the US and Europe, which have long fueled the continent’s automobiles, trucks, and generators. Sources said that as early as December, the refinery will begin producing jet fuel, kerosene, and diesel.
Despite Nigeria being a significant oil producer for more than 50 years, Dangote called the country’s incapacity to process its crude oil “shameful” and stated that the country will resume manufacturing refined petroleum products in a few weeks.
Dangote, who acknowledged that there were moments when he believed the enormous project—which was over $8 billion over budget and had been delayed for a long time—may endanger his business empire, thanked God for finally bringing the multibillion-dollar project to completion in spite of several obstacles.
He said, “The challenges that we faced, I don’t know whether other people can face these challenges and even survive. It’s either we sink or we sail through. And we thank Almighty that at least we’ve arrived at the destination. You will not see this kind of project in Nigeria in the next 20 years. No outside contractor had been willing to take on Nigerian risk. We didn’t cut costs. We didn’t cut corners. We didn’t do it for people to clap us. We did it for posterity.”
The International Monetary Fund, IMF, had said it doubts the refinery will reach more than a third of its 650,000 barrels a day capacity by 2025. However, Aliko Dangote was optimistic as he said he believed the refinery could reach its capacity of 650,000 barrels a day by the end of 2024.
The refinery is located in the Lekki Free Trade zone in Lagos State. Once it is fully up and running, it will turn oil powerhouse Nigeria into a net exporter of fuels, a long-sought goal for the country that is currently almost totally reliant on imports.
Reacting to information that the Nigerian National Petroleum Company Limited, NNPCL, which owns 20 per cent of the refinery after a $2.76 billion equity purchase in 2021, has been unable or unwilling to supply him with the crude his refinery needs, Dangote said, “Let’s not have the blame game here. We have resolved all the issues of supply.”
Speaking on shareholding by the NNPCL and some insinuations that he rejected suggestions that NNPC was playing hardball to negotiate a bigger share of the refinery, Dangote said, “I don’t think NNPCL needs to buy more shares. I think they’re OK with what we’ve given them.”
The refinery began the commissioning process in May this year after running years behind schedule at a cost of $19 billion, above initial estimates of $12-14 billion. Naira Devaluation Deepens Economic Crisis in Nigeria
Commissioning includes testing the different units that make products from gasoline to diesel and making sure they respond to the control panels. The facility was commissioned by former President Muhammadu Buhari a few months ago at the twilight of his administration.
