Contrary to the widely held belief that the Nigerian National Petroleum Company Limited (NNPC) holds a 20 percent stake in Dangote Refinery and Petrochemicals, Alhaji Aliko Dangote, President of Dangote Group, revealed that the national oil company actually owns only 7.2 percent of the asset. Dangote, Africa’s richest man, disclosed this during a tour of the 650,000 barrels per day (bpd) refinery, addressing questions from editors and media executives.
Chief Corporate Communications Officer of NNPC, Olufemi Soneye, explained that the company decided to cap its investment at the amount already paid, which equates to a 7.2 percent stake. According to Dangote, while the initial agreement with NNPC was for a 20 percent stake, the national oil company did not pay the balance of the money by the agreed deadline and opted to retain their existing shareholding.
Dangote also announced that the refinery, which recently added Brazilian crude to its feedstock, plans to start purchasing crude from African producers to increase capacity. He emphasized the extensive challenges faced in setting up the refinery, noting the project’s scale and the infrastructure issues encountered. Despite these hurdles, Dangote expressed satisfaction with the project’s progress and its potential for job creation and economic self-sufficiency.
Highlighting the need for policy consistency to encourage investment, Dangote urged the federal government to focus more on domestic investors. He praised the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) for resolving crude supply issues and stressed the importance of adhering to guidelines outlined in the Petroleum Industry Act.
Dangote also revealed plans to list Dangote Refinery and Petrochemicals Limited and the Dangote Fertiliser Plant on the Nigerian Exchange Limited by the first quarter of 2025. He stated that this move would allow Nigerians to purchase shares in the company, contributing to the local economy.
In a presentation, Dangote projected significant revenue growth for Dangote Group, aiming to increase revenues sixfold to about $30 billion by 2025 from $5.4 billion in 2022. The group plans for 15 percent of revenue to come from its cement business, 50 percent of EBITDA from outside Nigeria, and 70 percent of revenue from foreign exchange. Dangote emphasized that their export strategy aims to alleviate foreign exchange pressure in the Nigerian economy and establish the group as a significant supplier of foreign exchange.
The Dangote Petroleum Refinery is designed to meet 100 percent of Nigeria’s requirements for liquid petroleum products, with surplus production for export. Utilizing advanced technology, the refinery produces environmentally friendly petroleum products and includes a petrochemical plant capable of producing 77 high-performance grades of polypropylene. Additionally, the refinery features a dedicated steam and power generation system and a 435MW power plant that can meet the total power requirements of the Ibadan Distribution Company, covering five states.
Overall, Dangote projected that the refinery would generate an annual market value of $21 billion for Nigerian crude oil, save/earn $9.9 billion in foreign exchange, and add over $25 billion to the country’s Gross Domestic Product through value addition.