Dangote’s $1bn Cement Investment Brings Hope to Okpella
As Dangote rolls in trucks for the commencement of the construction of a six million metric tonnes per annum integrated cement plant in Okpella, Crusoe Osagie writes that the hitherto drowsy community nothern part of Edo State is jolted to life Okpella
A sleepy community in the northern part of Edo State, last Sunday, was jolted, perhaps like it has never been before, since it was founded
For a community with a population of 200,000 people, receiving visitors numbering up to 5,000 from Lagos, Jigawa, Abuja, Kano, Kogi,Ekiti, Ogun, China, India and several other places within three days was almost an inundation.
However, the community made up of Afemai people was besieged for good reason. In the next 26 months Dangote would have completed a six million metric tonnes per annum (mmtpa) integrated cement plant, with a whooping $1billion expended.
For a community where the total revenue in circulation in its local economy is a few millions, the injection of $1billion in two years would without doubt change its socio-economic dynamics.
If the news of what the President of Dangote Group, Mr. Aliko Dangote, had promised to do in the community was earlier received with a measure of doubt from the people, the convergence of the nation’s power wielders and policy makers on their little town certainly banished that.
With the likes of the Emir of Kano and former Governor of the Central Bank of Nigeria (CBN), Muhammadu Sanusi II, leading the Kano State Governor, Abdullahi Umar Ganduje, other royals from Jigawa, Kogi and several others to the ceremony to announce the commencement of construction of the project, the people of Okpella caught a glimpse of the importance of their humble abode to the biggest black investor in the world.
Other dignitaries who graced the event included the Chairman of THISDAY Newspapers and Arise Television, Mr. Nduka Obaigbena; Governor of Edo State, Adams Oshiomhole; Minister of Solid Minerals Development, Dr. Kayode Fayemi; Minister of State for Industry, Aisha Abubakar; President of Forte Oil, Mr. Femi Otedola; former Governor of Ogun State, Chief Segun Osoba; former Governor of Ekiti State, Chief Niyi Adebayo, President of the Manufacturers Association of Nigeria (MAN) Dr. Frank Jacobs, senators, members of the House of Representatives, and the Edo State House of Assembly, among many others.
Dangote, at the event, announced the commencement of the company’s $1 billion, 6 mmtpa cement plant as part of the activities to mark his 59th birthday.
Fayemi, who spoke during the ceremony, described the investment as consistent with the policy drive of the federal government targeted at the diversification of the economy from crude oil.
According to him, the mining sector would contribute over $25 billion to the national economy, creating huge revenue flows to drive it in the face of rapidly declining crude oil prices.
“The mining sector has the capacity to contribute over $25 billion to the national economy by 2025, creating new employment opportunities, developing local content and increasing tax revenue for the state and the federal governments,” Fayemi said.
Oshiomhole, said the investment was equivalent to the total capital expenditure deployed in the state since he assumed office over seven years ago.
He called on other businessmen and women to emulate the investment drive of Dangote, saying that this was the only way the country would grow from strength to strength and create job opportunities for the nation’s teeming unemployed youths.
“Over the next 26 months, cement will be rolling out of the facility and I want to say that this investment would not have been possible without peace and confidence in the state,” Oshiomhole said.
He noted that the investment would create job opportunities for about 24,000 people directly and indirectly.
Abubakar, in her speech, said the investment was a proof that Nigeria could move away and survive with non-oil products.
She noted that Dangote was the largest employer of labour after the federal government, adding that the ministry would continue to partner the firm in terms of innovation and technological development.
“As we move forward, we want to implore other well-meaning Nigerians to provide opportunities for mentorship for the young ones to grow,” she said.
Africa’s richest man, Dangote, said the new cement plant was expected to further increase the $3 billion the country had been saving from import substitution in cement yearly.
He maintained that the new 6mmtpa capacity cement plant was coming on the heels of a similar arrangement for another 6mmtpa cement plant in Itori, Ogun State, where the company is currently running a 12mmtpa cement plant at Ibese.
He noted that by this investment, Dangote’s production capacity would increase to 41mmtpa in Nigeria alone, adding that he would never shy away from investing in the country because the nation still remained the best place to invest in the world.
“A key factor that drives investments in an economy is the presence of an investor-friendly business climate. Indeed, Edo State today is one of the most attractive investment destinations in Nigeria.
“The economic reforms in Edo State especially in the area of tax, innovations in rural finance and investment on infrastructure, have produced the enabling environment that has further provided a platform for future growth. All these factors made us consider investing in the state,” he said.
Dangote noted that Nigeria was a growing economy, adding: “Our developmental challenges are quite enormous and will require the combined efforts of government and private sector to overcome them.
“It is in this light that we are here to contribute our own quota to transforming the economy of Edo State as we have done elsewhere. This project is only one of our several successful projects presently ongoing in parts of the country and outside in more than 15 other locations in African countries in line with our pan African investment strategy.”
He said in June last year, the group commissioned its cement plant in Ethiopia, Zambia and Cameroun, adding that there were plans to commission other plants in Senegal and South Africa very soon.
“Also last year, in Lagos, we signed a deal valued at $4.34 billion, with Sinoma International Engineering Company Limited for the construction of 10 additional new cement plants across Africa, with one in Nepal in Asia. The combined capacity of these new projects will be 25 million metric tonnes per annum.
“By the time all these new projects are completed in the next few years, we will have a total capacity of 81 million metric tonnes per annum. This will make us one of the top six cement companies in the world.”
He pointed out that the group was consolidating its cement businesses across Africa in order to reap from the benefits of scale, stressing that its operational offshore cement plants had started to make substantial contributions to its revenue.
“In addition to manufacturing, we are also investing heavily in agriculture for massive employment generation. Recently, we have commenced multi-billion dollar rice projects in some states in the north and we recently flagged off a rice out-grower scheme with the distribution of rice seedling to farmers in Jigawa State to reduce our dependence on imported rice, create massive jobs for the people and provide good returns to the famers.
“We envisage producing up to one million tonnes of white rice with the cultivation of 200,000 hectares of land. This will lead to a conservation of about $11 billion presently spent on the importation of food items that could otherwise be produced locally.
“It is gratifying to know that the federal government has recently announced that it is putting in place strategies that will make farmers have greater access to implements and other inputs,” Dangote said.
In his welcome address, the Okuokpellagbe of Okpella Kingdom, Dr. Andrew Dirisu, lauded the doggedness of Dangote Cement and its prompt response to the call for the establishment of the cement plant, and commended the state governor for his support in acceding to the desire of the people to have Dangote Cement in the community given the abundance of the raw materials in the community.
He promised that the community would provide the enabling environment for the investment to thrive as it is to the benefit of Okpella and her people for the plant to operate and generate economic activities.
He urged the company’s management to ensure that the various corporate social responsibility projects that the Dangote Cement was known to have provided for other host communities were also replicated in Okpella.
Dangote Cement is a fully integrated quarry-to-customer producer with production capacity of 29.25mta in Nigeria. Its Obajana plant in Kogi State, Nigeria, is the largest in Africa with 13.2mta capacity across four lines.
The Ibese plant in Ogun State has four cement lines with a combined installed capacity of 12Mtpa. The Gboko plant in Benue state has 4Mta. In addition, the company is investing several billion dollars to build manufacturing plants and import/grinding terminals across Africa. It has operations in Senegal (1.5Mta), South Africa (2.7Mta), Cameroon (1.5Mta), Ghana (1Mta import facility), Ethiopia (2.5Mta) and Zambia (1.5Mta). We are also building plants in Tanzania (3Mta), Republic of Congo (1.5Mta), Kenya (TBC), Nepal (TBC) and Zimbabwe (TBC). We plan to build import or grinding facilities in Sierra Leone (0.7Mta), Ghana (1.5Mta), Cote D’Ivoire (1.5Mta), Liberia (0.7Mta). Just last week, the Company commenced arrangements for the construction of 3m mtpa grinding plant in Cote d’Ivorie
In his comments, the Kogi State Governor, Alhaji Yahaya Bello, commended the investment in Edo State which shares a common border his state.
According to him, the presence of the federal government delegation at the event, as well as such a diversity of interests and groups, clearly underscored the importance which the present administration, and other well-meaning people, have placed on the industrialisation of the country.
He said Dangote Cement Factory, Okpella would be a good thing for Edo State, adding that It would also be a good thing for his state.
“As we all know, Kogi State already hosts one of the largest cement plants in Africa, the Obajana Cement Plant, courtesy of this same Dangote Cement Plc. We project that a nucleus of allied enterprises will develop around the two plants providing enhanced opportunities for co-operation and wealth-creation between our two peoples. We wholeheartedly felicitate with His Excellency, my brother Adams Oshiomhole, and the wonderful people of Edo State.
“Alhaji Aliko Dangote is a visionary industrialist with the interest of Nigeria at heart. A completely de-tribalised Nigerian, he employs millions of Nigerians directly or indirectly in his many ventures across the country and Africa. Given the current challenges facing our country, the Dangote Group led by the serially successful Alhaji Aliko Dangote deserves great commendation for defying the actual and perceived harshness of the operating environment to set the pace for Nigeria’s industrial revolution.
“He has through his multi-billion Naira investments, demonstrated that Nigeria is one of the best places in the world to turn over capital investments. I am indeed convinced that Nigeria will achieve the economic greatness that we all desire, at a faster rate, if we have more Dangotes in the country. I therefore wish to commend Alhaji Aliko Dangote for believing so much in this country, and I request that we all rise and give this great Nigerian and his Team a standing ovation.
“It is best to be proactive in managing host community relations. Regular and thoughtful Corporate Social Responsibility interventions will go a long way in maintaining the friendliness with which we are starting this relationship today. Care and respect for the environment is crucial. The people and their health, their water sources, their lands and crops, the atmosphere itself must all be protected from chemical pollutants and effluents. We must all join hands to contain global warming. Accordingly, the carbon footprint of this venture must be ameliorated as much as is humanly possible by the Investors.
“One must be forward-looking at these events. I strongly enjoin Dangote Cement Plc to remain mindful of international best practices in their dealings with the host State and communities. Proactivity in the considerate use of public amenities, including roads, the payment of lawful taxes, rates and levies and inclusiveness in the employment process, are always wise courses of action in this regard. This is the global norm now for ethical businesses such as we believe the Dangote Group to be. It is also the easiest way to avoid the community unrests that occasion down-time in productivity and cost all concerned both money and time.
“This factory, no doubt, is going to put Okpella, Edo State on the world map. The man who must eat kayan ciki (the intestines) of an animal slaughtered for meat must occasionally come across its dung at mealtimes. The host communities must also determine to enjoy this blessing like kayan ciki – with a lot of patience. The extractive industry is disruptive, and not too clean. There will be some nuisance from the various segments of the cement manufacturing process. We must be patient, and seek dialogue first, never war. It is my prayer that this plant will open up these communities to rapid infrastructural development and accelerated provision of social amenities,” he said.