Africa’s richest man, Aliko Dangote, is building one of the world’s largest oil refineries and a petrochemical complex, with the aim of selling refined petroleum products, as well as fertilizer and natural gas to Ghana and other parts of the world, starting from 2019.
Nigeria, Ghana and other African countries are some of the world’s top oil producers, but they don’t have enough gasoline to fuel their struggling economy.
On the outskirts of Lagos, Africa’s richest man is building what he says is a solution to the Africa’s fuel crisis. A massive 650,000 barrel-per-day refinery that is designed to turn the continent’s crude oil into gasoline for hungry consumers occupies over 2,630 hectares of land, an area which is eight times larger than the entire Victoria Island in Lagos at a cost of $16 billion.
Aliko Dangote, a concrete magnate who is worth an estimated $15 billion, said the refinery and petrochemical plant has the potential to satisfy Nigeria’s daily requirement of 445,000 to 550,000 barrels of fuel, with spare capacity to export to a country like Ghana.
There are reasons to believe Dangote will meet his goal of bringing the factory online by late 2019. He has already completed several major projects in Africa, including the world’s largest sugar refinery and cement factory.
If his refinery project is successful, Nigeria could even become an exporter of gasoline and other petroleum products to the West African Region.
Nigeria’s four state-owned refineries are currently operating at just five per cent capacity following decades of poor maintenance, mismanagement and corruption.
For average citizens, the lack of domestic refining capacity has meant frequent power cuts and eight-hour lines at gas stations.
Nigeria produces between 2.2 million and 2.5 million barrels of crude per day, yet is not able to process more than about 100,000 barrels per day.
Meanwhile, plunging crude prices have pushed Africa’s largest economy to the brink of recession. Energy accounts for about 35 per cent of Nigeria’s gross domestic product, 75 per cent of government revenue and 90 per cent of export earnings.
The government is now racing through its foreign currency reserves, and a shortfall of $11 billion in its 2016 budget has forced officials to discuss a potential cash infusion with the World Bank.
Dangote, for one, is not losing any sleep over low oil prices.
The petrochemical plant is expected to produce 750,000 metric tons of polypropylene yearly, a capacity which is 13 times bigger than the Eleme Petrochemical Unit by Nigeria National Petroleum Corporation.
The General Manager of the Fertilizer Plant, Anurag Jaiswal said: “the fertilizer plant, which becomes operational in 2017 is expected to produce 2.8 million metric tons of urea and ammonia yearly.”
The Group Head, Corporate Communications of Dangote Industrial Limited, Anthony Chiejina, told Business Day in Lagos that his outfit intends to sell natural gas to Ghana through West Africa Gas Pipeline Company.
From F.D. Klutse, Lagos, Nigeria
