Business
Dangote Refinery To Employ 100,000, Generate $21bn
Amid encomium from eminent personalities, which included President Mohammadu Buhari and five other African heads of state, President of the pan-African Conglomerate, Dangote Industries Limited (DIL), Aliko Dangote disclosed on Monday that the newly commissioned 650,000pbd refinery would employ over 100,000 Nigerians as well as generate over $21 billion, thereby saving the country huge forex, that would have gone for fuel importation.
The company, according to him, now has over 33,000 employees.
Much to the excitement of Nigerians, Dangote said the commissioning has marked the beginning of the new journey of the self-sufficiency in refined petroleum products and exportation of same just as been achieved in Cement and lately fertilizer.
Dangote lamented that the current fuel crisis has had negative impact on the nation’s economy and that informed his decision to build a world class refinery that would change the trend and that though faced challenges but decided to trudge on.
He highlighted events leading to his firm deciding to build its own refinery after his attempt to acquire one of the existing moribund did not materialize noting that he decided to change marketing strategy and settle for gigantic project ever undertaken by an individual world over.
According to him, the refinery plant would be run at the highest effective and efficient level for maximum benefits to all Nigerians noting “we will replicate what we achieved in cement and fertilizer by attaining self-sufficiency and becoming net exporter.
Dangote assured Nigerians that 40 percent of the production capacity will be available for export with the coming on stream of the plant guaranteeing raw materials for plastic, and pharmaceutical industries.
In his remark, President Buhari congratulated Dangote Group, saying “the 650,000 barrels a day of crude which will enable our country to achieve self-sufficiency in refined products and even have some supplies for export saying the government and people of Nigeria are proud of the doggedness and tenacity of Dangote as entrepreneur.
Said he, “This feat at this time of the nation’s economic development clearly made this event a notable milestone for our economy and the game changer for the downstream petroleum products not only for Nigeria but the entire African continent. Dangote Group has helped transform our economy from heavy import dependence to a net exporter in some critical industries, including cement and Fertiliser.”
He noted that the economy which has been stressed for many decades by huge deficits in economic infrastructure and over a decade of insurgency has also been severely impacted by several external crises, including the global financial crisis, the collapse of world crisis the Coronavirus pandemic and the Russia Ukraine war.
“The consequences of these challenges constitute a severe strain on our economy and limiting government’s ability to provide basic infrastructure without resorting to borrowing. Government therefore decide to focus attention on creating an enabling environment for the private sector to thrive and fill the enormous gap in investments not only in infrastructure, but also in all critical sectors.
“We recognize that without active participation of the private sector and a strong commitment to public-private partnership, the economy will not be able to continue to meet the challenge and economic growth”, while expressing the hope that the coming administration will continue to apply such innovative schemes to accelerate the fruition of critical infrastructure, in particular roads and gas pipelines.
Governor of Central Bank of Nigeria (CBN), Godwin Emefiele while commending Dangote for the successful completion of the refinery project said it would not only aid that nation’s domestic petrol needs, but also help in generating export revenues for our country.
Emefiele recalled; “In September 2013, when Alhaji Aliko Dangote announced his plans for the refinery, it was estimated to cost about US$9 billion, of which US$3 billion was projected as equity investment by the Dangote Group and the balance financed through commercial loans. Due to an array of factors, the project was eventually completed with a total of US$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.
“What you may not be fully aware of, Your Excellencies, is that the Dangote Group has started repaying some of the commercial loans even before the commissioning of this facility. This reflects 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 US$9 billion to US$3 billion.”
The CBN Governor commended Nigerian banks saying they did not only partnered with the project through effective financing but were keenly aware of the importance of the project for our nation. “They provided immense support and exceptional understanding, even when interest payments and principal repayment had fallen due.”
He described the successful completion of the refinery to President Buhari’s astute vision to ensure that Nigeria produces what Nigerians consume and that we consume what we produce. “The refinery and petrochemical project by the Dangote Group is a testament to your vision for Nigeria. It shows that, regardless of what the world thinks, Nigeria can be self-sufficient in all products that we consume and at the same time export our excess output to the rest of the world.
“Aside enumerating our strategic efforts in the agriculture and other critical sectors, a sterling projects that we highlighted was the gigantic Dangote Refinery and Petrochemical project. The world doubted our willpower to succeed with this project. In hindsight, I could appreciate their skepticism because they do not understand how a single individual could build a refinery capable of serving an entire nation. To them, projects of this magnitude are usually only undertaken by sovereigns not individuals.”
Group Managing Director of the Nigerian National Petroleum Company Ltd (NNPC), Mele Kolo Kyari said the NNPC was happy to partner Dangote Refinery because the project has potentials for smooth supply of petroleum and it would guarantee healthy competition for the benefits of the nation’s economy.
He said the NNPC Ltd. was committed to value addition to the potentials of the project noting that the new Petroleum Industry Act will provide security of supply of refined products and protect the plant. The NNPC boss added that his was happy the refinery is coming on board at a time the subsidy on imported products has become unbearable for government.
In their respective goodwill messages, Presidents of Ghana, Senegal, Niger, Benin Republic and Chad expressed satisfaction that the Dangote Refinery will serve the West African region and that their countries would be beneficiaries saying the Dangote Refiner is an African company for Africa by an African entrepreneur.
Following the marginal reduction of the pump prices of premium motor spirit (PMS) by the Dangote Petroleum Refinery and the Nigerian National Petrol Company Limited (NNPC Ltd), civil society groups have reacted by calling for further downward review.
Recall that the Dangote Petroleum Refinery had announced a partnership with MRS Oil and Gas to offer petrol at N935 per litre at retail outlets, while it reviewed the ex-depot price from N970 to N899.50 per litre.
The move, saw state oil major, the Nigeria National Petroleum Company peg its retail prices at N965/litre.
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However, the civil society groups are of the opinion that the price reduction, fall short of expectations.
According to the Chairman, Centre for Accountability and Open Leadership, Debo Adeniran, the reduced price of N935/litre was still expensive and unsatisfactory.
He pointed out that petrol was just one of the products coming out of crude and that both government and private business could still give out free petrol to citizens while making huge profits from the other products.
In his words, “Well, we believe that if NNPC and the private sector actually give out PMS for free, they will still not run their business at a loss, because the other derivatives of petroleum products can still serve them, and can still make them to break even. So, even at that N900 and something, it’s still expensive.
“Dangote has kind of mooted the idea that it could drop to as low as N650. And if he has mulled this, then it means that it is the state, it is the NNPC that will have been the clog in the wheel of such progress. And you know also that we expected that fuel prices, especially PMS prices, will drop below N200 when Dangote was expected to come on stream.
“So, it’s unfortunate that we are still talking about over N900 and they want us to jump up and rejoice for that. That is not satisfactory. They should just let us see the breakdown of their production cost and why it’s still there. I mean, there are countries like Libya under Gaddafi that gave out PMS for free and they didn’t run anything at any loss. So, I believe that it can still go further down.”
On his part, the Executive Director of the Civil Society Legislative Advocacy Centre, Ibrahim Rafsanjani, commended the reduction of fuel prices by the NNPC and Dangote, but said the government could still reduce the price.
“Dangote’s own is about N899 or something like that. Well first and foremost, we are happy that there is a little reduction in the prices. But also based on analysis and based on facts and evidences, we believe that it is possible for the Nigerian government to further reduce the prices.
“Because if a private company can reduce the price and it still makes profit, we wonder why government-owned enterprises cannot really pity its citizens,” he said.
The Central Bank of Nigeria (CBN) has announced a significant growth in the country’s economy, with a 3.46% increase in gross domestic product (GDP) in the third quarter of 2024.
This marks the third consecutive quarter of expansion, up from 3.19% in Q2 2024 and 2.54% in Q3 2023.
According to the newly published Q3 economic report, Nigeria’s GDP output rose to ₦20.115 trillion, reflecting a notable improvement from ₦18.285 trillion in the previous quarter.
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The CBN attributed this growth primarily to the performance of the non-oil sector, which grew by 3.37% compared to 2.80% in Q2 2024.
The report highlighted transportation, crop production, and other sub-sectors such as financial & insurance services, information & communication, trade, and real estate as major contributors to the expansion.
The non-oil sector accounted for 3.18 percentage points of the total growth rate.
“The expansion of the non-oil sector was driven by the performance of the financial & insurance, information & communication, crop production, trade, transportation & storage, and real estate sub-sectors,” the report stated.
Despite the economic growth, challenges persist. Inflation, particularly in food prices, remains a significant concern, standing at 39.93% as of November 2024.
Rising food and energy costs have also impacted transportation expenses, with intercity bus fares increasing by 20.23% year-on-year to ₦7,117.17 in July 2024, according to the National Bureau of Statistics.
Furthermore, the cost of petroleum, now exceeding ₦1,000 per litre, has driven up logistics and transportation expenses, adding pressure to households and businesses alike.
The CBN acknowledged these challenges, noting that the growth was achieved despite headwinds such as high inflation and rising operational costs.
Enhanced security measures in the Niger Delta have boosted domestic crude oil production, while restrictive monetary policies have helped moderate inflation in some areas.
“The growth recorded in the country is a result of continued efforts to improve the business environment, streamline cumbersome business processes, and deepen the quality of business infrastructure,” the CBN noted.
However, the report comes amid concerns over businesses exiting Nigeria due to persistent economic challenges.
Asharami Synergy, a leading downstream energy solutions provider, has demonstrated its commitment to community development and education by donating essential furniture to Gaskiya Junior School in Ijora, Lagos, Nigeria.
Biztellers reports that the social responsibility initiative was executed in collaboration with Sahara Group Foundation – the social impact vehicle of global energy conglomerate, Sahara Group.
It was gathered that the initiative is part of Asharami Synergy’s ongoing efforts to support education in communities.
The donation includes classroom desks and chairs for the JSS1 classes.
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CEO of Asharami Synergy, Nomnso Dike, said the project will create a more comfortable and functional learning environment and enhance student performance.
“We are delighted at the opportunity to support the attainment of Sustainable Development Goal (SDG) 4, which focuses on ensuring inclusive and equitable quality education. It has been a privilege to collaborate with the management and students of Gaskiya Junior School to deliver this project, and we look forward to future opportunities to enhance academic performance in this historic institution,” Dike said.
According to him, Asharami Synergy’s education-focused social impact initiatives have benefitted over 10,000 individuals. They focus on building capacity and providing the resources necessary to help students learn and grow sustainably.
“Education is the foundation of a brighter future, and at Asharami Synergy, we believe that every child deserves a learning environment that inspires and empowers them” he noted, adding, “This donation is not just about providing furniture; it’s a reminder to the students that their dreams are valid, and we are committed to helping them achieve their goals.”
Vice Principal Academic of Gaskiya Junior School, Sola Oladokun, commended Asharami Synergy for the donation, noting that it would inspire students to perform better with “increased concentration and fewer distractions”.
“These desks and chairs are a game-changer for our students. It’s heartwarming to see their excitement, and as teachers, we are equally thrilled because this will make teaching and learning more effective. We are incredibly grateful to Asharami Synergy and Sahara Group Foundation for this thoughtful intervention,” she added.
Two representatives of the students, Akin Moses and Chukwudi Gift, at the event said the donation would increase their “desire to dream bigger and concentrate better during lessons”.
Also speaking at the commissioning, COO at Asharami Synergy, Adekanmi Adesola, said, “What started as an opportunity to support the communities that host our operations has now come full circle. This donation directly impacts the lives of these students, and we are proud to bring smiles to the faces of the students and teachers.”
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