Dangote To List Refinery On NGX, NNPC Held To 20% Stake

Dangote Refineries Will Create Massive Jobs - Aliko Dangote

The company’s chairman, Mr. Aliko Dangote, has disclosed that Dangote Refinery and Petrochemical Limited would eventually be listed on the floor of the Nigerian Exchange (NGX) Limited. The wealthiest man in Africa, Mr. Dangote, reaffirmed this in an interview that was released on Saturday.

The refinery will join Dangote Cement, Dangote Sugar, and NASCON—other companies owned by Mr. Dangote that presently trade their stocks on the NGX.

The oil plant, estimated to be valued at $20 billion, was unveiled in May 2023 by Mr. Muhammadu Buhari, the former president of Nigeria, albeit it hasn’t yet started to operate.

It was reported a few weeks ago that the Nigerian National Petroleum Company (NNPC) Limited, one of its major shareholders, was starving the refinery of crude oil supply, which prevented it from starting to produce premium motor spirit (PMS), also known as gasoline. The country is currently dependent on the importation of the commodity from Europe, particularly from the Netherlands and Belgium.

However, Mr. Dangote stated in the interview that this problem has been fixed and that the refinery may start supplying the country with jet fuel, diesel, and kerosene in December 2023—just a few days away.

“We’re starting with 350,000 barrels a day. [We have sealed a deal for the first cargo of about 6mn barrels [for delivery in December],” he was quoted as saying.

According to him, “We have resolved all the issues of supply [with the NNPC,]” he said, refusing to blame the state-owned oil-firm for the difficulties in supplying crude oil to the refinery.

“Let’s not have the blame game here,” he declared in the interview.

However, he expressed optimism that the oil facility would be a game-changer for Nigeria, especially when it is listed on the domestic stock exchange, stressing that the NNPC was not attempting to increase its stake in the organisation with the supply-restriction tactics.

Recall that in 2021, the NNPC acquired a 20 per cent equity stake in Dangote Refinery for about $2.76 billion, and there have been speculations that the firm was planning to increase its shares in the company, which has the capacity to produce 650,000 barrels of crude oil per day and could generate $25 billion a year.

But Mr Dangote, who is 66, played down these rumours, saying, “I don’t think NNPC needs to buy more shares. I think they’re OK with what we’ve given them.”

The commencement of production date of Dangote Refinery has been shifted more than three times in 2023. In August 2022, the NNPC said the oil facility would begin operations by mid-2023, but this did not happen and at the commissioning of the refinery on May 22, 2023, in Lagos, Mr Dangote said the first product from the mega-complex structure “will be in the market before the end of July, beginning of August this year”.

In September 2023, the Dangote Group Executive Director, Mr Devakumar Edwin, told S&P Global Commodity Insights that the refinery will kick off production with 350,000 – 370,000 barrels per day of diesel and jet fuel by October, when the crude distillation unit, sulfur block and hydrogen plant should be online.

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