Dangote Group has said that the company is developing a new oil refinery that will be producing 500,000 barrels per day in Nigeria.
A senior Dangote Group official who disclosed this on Tuesday, said that the refinery which will be located in Lagos, will cost $9 billion and is expected to come onstream by 2017.
“By the third quarter of 2017, we expect to be looking at commissioning,” Mansur Ahmed, Dangote Industries Ltd’s executive director of stakeholder management and corporate communications, told Reuters at an African refiners conference in Cape Town.
The refinery is being designed to process Nigerian crude mix and produce products conforming to Euro V fuel specifications, as fuel demands across the continent are forecast to rise rapidly with many countries enjoying strong economic growth.
Ahmed said the refinery, which is being funded by debt and equity, including a $3 billion commitment from Dangote himself, could list in future should additional capital be needed.
“In the past when we have reached a point where we feel we need to increase capital we have listed,” Ahmed said.
“We have listed our cement business, we have listed our sugar business and our salt business… and, if you like, history is the best teacher.”
The Dangote Group is known for its cement production, which is the largest in Africa, as well as basic food processing. A refinery will pose a threat to European refiners and oil traders, who make huge profits bringing gasoline into the country.
Nigeria imports more than 80 percent of its fuel needs.