IT was a moment of ecstasy for Nigerians on Monday as President Muhammadu Buhari commissioned 650,000 barrels/day $18.5 billion Dangote Petroleum Refinery in Ibeju-Lekki, Lagos.
The newly inaugurated refinery is to enable Nigeria to achieve self-sufficiency in refined products and have surplus for export.
First product from the new refinery is expected to hit the market by end of July,2023.
Speaking on the occasion attended by Heads of State from Ghana, Togo, Niger, Senegal and a representative of the President of Chad, President Buhari described the feat as a significant milestone for Nigeria’s economy and a game changer for the downstream petroleum products market in the entire African region.
According to him, the mega industry being commissioned was a clear example of what could be achieved when entrepreneurs are encouraged, supported and an enabling environment is created for investments and for businesses to thrive.
‘He said: “I am confident that my successor, His Excellency Asiwaju Bola Ahmed Tinubu, will sustain the improvement in our economic and business environment and strengthen the framework of our public private partnership policies to accelerate the pace of our economic growth and development.
“I am happy to leave our economy in very competent hands.”
The president commended Alhaji Aliko Dangote’s leadership in executing the 650,000 barrels per day refinery, urging other entrepreneurs to emulate his example in driving economic growth and realising Nigeria’s economic potential.
He stressed the need for African countries to come together, integrate their economies, eliminate trade barriers, and rally their populations to achieve Agenda 2063 for the continent’s prosperity.
“I urge and encourage our other great entrepreneurs to emulate this iconic Nigerian industrialist and join the Government in accelerating our growth in order to realize our country’s globally recognized economic potential.
“When I travel around Africa and meet and engage my brother Heads of State (and I am delighted some of their Excellences are here) I often sense a quiet expectation that our country is blessed with resources and human capacity to lead Africa’s rise to economic prosperity and the attainment of Agenda 2063 – ‘The Africa we all want.’
“But to achieve the goals of Agenda 2063, Africa must come together – we must integrate our economies, eliminate barriers to trade and energize our youthful population to scale up our productive capacity.
“We must create necessary conditions for our private sector to grow and partner with the public sector to accelerate economic growth across the continent.
“We must not allow outside powers to use some of our leaders to destabilize our economic and political trajectory,” Buhari said.
The president acknowledged the visionary investments made by the Dangote Group, under the leadership of Aliko Dangote, in transforming Nigeria’s economy through its involvement in critical industries such as cement and fertiliser.
Speaking earlier, President/Chief Executive, Dangote Group, Alhaji Aliko Dangote, hinted that the first product from the newly inaugurated $18.5billion refinery would hit the market end of July, 2023.
According to Dangote, the first goal was to ramp up production of the various products to ensure that within this year, the group is able to fully satisfy the nation’s demand for high quality products.
“Beyond today’s ceremony, our first goal is to ramp up production of the various products to ensure that within this year, we are able to fully satisfy our nation’s demand for high quality products to enable us eliminate the tragedy of import dependency and stop, once and for all, the dumping in our market of toxic sub-standard petroleum products,” the President of Dangote Group said.
He added that the newly built refinery has a capacity to process 650,000 barrels per day of crude oil (plus 900,000 tonnes of polypropylene) in a single train – which is the largest in the world.
He said the products slate was designed to meet the highest quality standards of high-value products including Premium Motor Spirit (PMS), Automotive Gas Oil (Diesel), Aviation Turbine Kerosine (ATK); “all of Euro V Standards that will enable us not only meet our country’s demand but also to become a key player in the African and global market.
He said;”Our coastal location and offshore loading and offloading (SPM) facilities with a capacity to receive all our crude oil supplies and evacuate up to 75 percent of our liquid products give us direct access to the rest of Africa and the global market for exports. In addition, 80 per cent of our production can be discharge through trucks nationwide.
“We have selected the best plants and equipment and the latest technologies from across the world.”
Talking about the immediate benefits of the commissioning to economy, Dangote stated that beyond beyond the constant availability of high-quality fuels for the transportation sector, the refinery would also make available to Nigeria’s industries, vital raw materials for a wide range of manufacturers in the plastics, pharmaceutical, food and beverages, packaging, construction, and many other industries.
According to him, while the refinery operation and ancillary businesses generate massive job opportunities, the downstream value chain would also provide far more absorptive capacity for labour in hundreds of thousands.
“Third, once our plant is fully onstream, we expect that at least 40 per cent of the capacity will be available for export and this will result in significant Foreign Exchange inflows into the country.
“Overall, we are committed to operating our Plant in line with international best practice. Recognizing the importance of protecting the environment, we have adopted stringent environmental, health and safety policies to ensure that the refinery operates in a safe and sustainable manner,” Dangote said.
Governor, Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, commended Dangote Group for the efforts, stating that under President Buhari’s leadership, the seemingly unattainable refinery project has berthed.
He expressed optimism that under the incoming administration of Bola Ahmed Tinubu, Nigeria will cease importing petroleum products, fertiliser and petrochemical that drained over $26 billion in 2022.
“The self-sufficiency in refined petroleum, urea, and polypropylene, which Nigeria has attained with this project is a strong testament to how leadership, dedication, focus, commitment, and resilience have helped Nigeria on its drive towards import substitution and export orientation,” he said.
He recalled that in September 2013, when Dangote announced his plans for the refinery, it was estimated to cost about $9 billion, of which $3 billion was projected as equity investment by the Dangote Group and the balance financed through commercial loans.
Due to an array of factors, he said the project was eventually completed with a total of $18.5 billion with funding distributed into 50 percent equity investment and 50 percent debt finance.
“I am proud to state that the commercial loan component of the project was financed majorly by our domestic banks with the balance sourced from foreign banks.
“The Central Bank of Nigeria also partnered, as always, with the Dangote Group in ensuring the successful completion of the project by providing about N125 billion, to cover domestic currency requirements for the venture,” he said.
Emefiele disclosed that Dangote Group has started repaying some of the commercial loans even before the commissioning of the refinery.
This, he added has reflected the commercial capability of the group and its chairman.
“I am pleased to inform everyone today that, following extensive repayments, outstanding debt has dropped appreciably from over $9 billion to $3 billion,” he said.
The take-off of the Dangote Refinery and Petrochemical factories, he pointed out came with numerous economic benefits to Nigeria.
“In the first instance, it will have enormous impact on job creation by generating thousands of direct jobs and millions of indirect jobs, with over 135,000 permanent jobs.
“I understand that, so far, there are nearly 4,000 Nigerian personnel on site, excluding employment by the various contractors and subcontractors at the project site.
“I am also proud to state that the project will generate up to 12,000MW of electricity. In addition, the refinery and the other ancillary projects will have significant multiplier effects on other sectors of the economy by supporting a diverse range of sectoral value-chains,” he said.
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