The President/Chief Executive Officer, Dangote Group, Aliko Dangote, has called out Nigeria, for being a major oil producer for more than 50 years and could not refine its crude in sufficient quantity.
Dangote stated that the $20bn Dangote refinery in Lekki, Lagos would start with the refining of 350,000 barrels per day of crude oil.
During an interview with the Financial Times, he mentioned that the refinery would receive about six million barrels of crude in December 2023.
โWeโre starting with 350,000 barrels a day, โDangote told the Financial Times, adding that a deal had already been clinched for the โfirst cargo of about 6mn barrelsโ for delivery next month.
Dangote said he believed the refinery could reach its capacity of 650,000 barrels a day by the end of 2024, although the IMF has said it doubts it will reach more than a third of that by 2025.
At full tilt, the refinery, the worldโs largest โsingle trainโ facility with just one distillation unit, could save Nigeria billions in foreign exchange currently spent on imported fuel.
It was โshamefulโ, Dangote said, that Nigeria, a major oil producer for more than 50 years, could not refine its own crude in anything like sufficient quantity.
Dangote conceded there were times when he thought the massive project โ long delayed and about $8bn over budget โ might jeopardise his business empire.
โThe challenges that we faced, I donโt know whether other people can face these challenges and even survive,โ he said. โItโs either we sink or we sail through. And we thank the Almighty that at least weโve arrived at the destination.โ
Yet in what is supposed to be Dangoteโs moment of triumph, he finds himself under intense pressure. A rival industrialist has accused him of underhand business practices and of gaining unfair access to foreign exchange from a central bank whose former governor is now being investigated by the authorities. Dangote has denied both allegations.
In addition, the Nigerian National Petroleum Corporation has been unable or unwilling to supply him with the crude his refinery needs, although Dangote insists it is only a matter of weeks before oil starts flowing.
A few even doubt the refinery will work at all, or predict that it will be inefficient. Rumours are also rife that Dangote, whom critics accuse of having unduly benefited from close relations with four successive administrations, has fallen out with Bola Tinubu, who became president in May.
In the interview, Dangote complained that rivals were complaining because they did not understand what it took to run a business that was the countryโs biggest private-sector employer and its biggest taxpayer. โSometimes when people talk about us, itโs like the government is holding everybody down and allowing us alone to fly.โ
He did not want to discuss in detail a tussle over the supply of crude with NNPC, which owns 20 per cent of the refinery after a $2.76bn equity purchase in 2021. Nigeria produces about 1.4 million barrels of oil a day, well short of its OPEC quota of 1.8 million barrels, with much pre-sold in forward contracts.
โLetโs not have the blame game here,โ he said of NNPCโs reported difficulties in meeting the refineryโs requirements. โWe have resolved all the issues of supply.โ
Dangote rejected suggestions that NNPC was playing hardball to negotiate a bigger share of the refinery, which he said would generate revenue of $25bn a year at full capacity. โI donโt think NNPC needs to buy more shares. I think theyโre OK with what weโve given them.โ
The refinery would eventually be floated as a separate company, he said, initially on the Lagos stock exchange.
