NNPC To Sell Crude Oil, Share Profit As Payment For Dangote Refinery Shares

Dangote Says Nigeria Should Not Be Comfortable Generating Revenue From Crude Oil Alone

Apart from the payment of $2.7 billion by the Nigerian National Petroleum Corporation (NNPC) for 20 percent equity in the Dangote refinery, the regulator will also sell crude oil and share its profits as part of the payment for its shares.

The President of the Dangote Group, Alhaji Aliko Dangote, said this on Tuesday, in a documentary aired on Arise News Channel.

According to him, the 20 percent equity will not be paid in a single cash transaction.

“So, these are the things that people don’t really understand and I want to really clarify it. When they talk about the $2.7 billion, you know, they (NNPC) are paying one-third of the money,” he said.

Dangote added, “Another one-third of the money, again, will actually be paid through the supply of crude, with the deduction of maximum of about $2 and some cents. And then one-third of it, which is another $850 to $900 million will be paid from the profit they are going to make from the business.

“So it’s not a cash transaction where they are paying all cash. You can see that if we don’t have confidence in what we are doing, we would have asked them to pay all cash.”

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He pointed out that there are a lot of misconceptions around the planned 20 percent equity holding by the national oil company, explaining that the deal also involves all the products to be churned out by the $19 billion facility, including petrochemicals.

He pointed out that the project currently employs 29,000 Nigerians and 11, 000 foreigners with plans to ramp up the number to 57,000 in the coming months.

The 650,000 barrels per day refinery, located in Lagos is expected to start operation in the first half of next year.

Stressing that the refinery is capable of meeting the country’s entire petrol, diesel and jet fuel needs, Dangote posited that as it stands, the country expends about 25 per cent of all its import bills on bringing in petrol products into the country.

About Author

Ife Ogunfuwa is an award-winning reporter who is versed in reporting business and economy, technology, gadgets reviews, telecoms, tax, and business policy review, among others. She loves telling stories behind the numbers. She has professional certifications in business and financial reporting. You can reach her via – [email protected]

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