*Business mogul’s fortune up $1.3bn this year on cement firm gains
Emmanuel Addeh in Abuja and Ugo Aliogo in Lagos with agency report
Africa’s richest man, Aliko Dangote, said mechanical work on his much-awaited crude oil refinery located at the Lekki Free Zone, in Lagos State, had been completed and the facility would begin to run between August and September this year. Dangote disclosed this at the weekend in Lagos during a facility tour of the oil refinery, the fertiliser plant, and the Dangote Jetty, in the company of President, African Development Bank (AfDB), Dr. Akinwumi Adesina.
Dangote said full production at the refinery could commence by the end of the year or the beginning of 2023. He lauded the AfDB president, and hinted that its polypropylene plant would yield about a million tonnes, which would bring $1.6 billion in terms of export revenue to the country. He assured his visitor that Dangote Group would continue to do more towards strengthening investment in the country, stating that the company has been meeting its tax obligations.
Dangote added that the Dangote Group had revitalised road infrastructure within Apapa and Isolo in Lagos, and also in Ogun and Kaduna, stressing that the group is equally involved in the development of deep seaports and other infrastructural projects across the country.
“Hopefully, before the end of the third quarter we should be in the market,” he stated.
The plant will start with a processing capacity of 540, 000 barrels per day, Dangote said, with full-fledged activities expected by the end of the year.
“Full production can start, maybe, by the end of the year or beginning of 2023,” he said.
The facility, which will cost an estimated $19 billion to build, has an installed capacity of 650, 000 barrels per day and was earlier scheduled to begin operation by the first half of this year. Its output would be more than enough to meet Nigeria’s fuel demand and turn Africa’s largest crude producer into an exporter of refined crude.
Recently, the African Petroleum Producers Organisation (APPO) estimated that beyond Nigeria, the refinery could reduce importation of petroleum products into the continent by as much as 36 per cent, according to Bloomberg.
Besides, APPO stated that the success of the project could incentivise the rise of similar projects across Africa, despite the current focus on energy transition.
Secretary General of the continental body, Dr Omar Farouk Ibrahim, had said the refinery would be supplying over 12 per cent of Africa’s demand when operational.
Group Executive Director, Strategy, Portfolio Development and Capital Projects, Dangote Industries Limited, Devakumar Edwin, said the refinery complex, which includes a refinery, petrochemical plant, a fertiliser plant, and a subsea pipeline project, was the largest single-train refinery in the world. Edwin stated that the 650,000 barrels per day refinery would stimulate economic development in Nigeria.
According to Edwin, Dangote Petroleum Refinery can meet 100 per cent of Nigeria’s requirement of all liquid products (gasoline, diesel, kerosene, and aviation jet), and also have surplus of each of these products for export.
He stated that this would create a market for $11 billion per annum of Nigerian crude and foreign exchange savings/earnings of $9.9 billion.
Edwin stated, “We have impacted on job creation with 3,580 Nigerian personnel on site, excluding employment by the various contractors and subcontractors at the site.”
He called on the federal government to harness the potential in the private sector as part of efforts to drive economic growth in the country.
Edwin also explained that continued investment in infrastructure would lower the cost of doing business, noting that consistency and stability of power would drive more growth for business, “and when investors put in a lot of money, that shows that there should be a lot for us to do.
“I think we also have to promote our own successes. We should celebrate our own business successes; we should support them and give them the chances to grow. We should provide them access to build a successful business environment in the country. Not just Dangote alone, but also the Small and Medium Enterprises (SMEs), too, to grow and thrive more in agriculture, agribusiness, digital economy, creative industries, and others that require a lot of support.”
He said strong support from government would go a long way in boosting business growth in the country.
In his remarks, the AfDB president described Dangote Refinery and Fertiliser projects as the best industrialised project to happen to Africa. He said the projects would not only positively affect Nigeria’s economic growth and development, but Africa’s as well.
Adesina described Dangote as an enigma, who should be honoured in Africa and even beyond for his passion, vision, and determination to develop and ensure that Africa was transformed.
He added, “One of the things I admire the most about Alhaji Dangote is that, he actually believes in Nigeria, and he invests his money in Nigeria. He believes in Africa and invests in Africa.
“Nobody could invest the type of billions of dollars that is here, unless the person not only has the vision but also the commitment and passion for his country. We are extremely proud of you and of your commitment to the continent.
“Aliko is quite an inspirational and visionary business leader and for anybody to have done what I have seen here, I think that person deserves world class kudos for that. I see a company that I will proudly call Africa’s growth accelerator company. With this project, we see an acceleration of how to reduce imports. We see an acceleration on how to have an outbound on export; a value chain development and how to compete regionally and globally.
“I am completely blown away with what I saw here today. I can’t believe what I saw. This project will reverse the huge sum the nation spends on foreign exchange. When you look at how much we import, it is about $57 billion worth of different products and we export only about $50.4 billion.
“So, we have to balance that with about $7 billion and talking to them here, they showed us that they can have a domestic market of about $11 billion and that is an incredible market and that will save Nigeria about $9 billion dollars a year from importing petroleum products. This is huge for Nigeria and even for Africa as a continent.”
On the fertiliser complex, Adesina said, “Being a man passionate about agriculture, this is a company that is producing three million metric tonnes of urea, which will make Nigeria totally self-sufficient.”
He added, “Nigeria will become net exporter of fertilisers. It will drive productivity growth in Nigeria, prices will come down and the quality will also improve.”
In October 2021, Governor of Central Bank of Nigeria (CBN), Godwin Emefiele, stated that Nigeria’s import of petroleum products using 30 per cent of its forex could be reversed by the successful commencement of operations by the Dangote refinery. Emefiele was speaking during a foreign investors’ meeting held in New York while answering questions raised by foreign investors.
Meanwhile, Dangote, originally a cement tycoon, is worth $20.4 billion, according to the Bloomberg Billionaires Index. Bloomberg reported that Dangote saw his fortune grow by $1.3 billion this month alone on the back of steep gains in the share price of his cement company.
Dangote Cement Plc, which accounts for about half the entrepreneur’s net worth of $20.4 billion, closed at the highest since 2010 on Friday, having gained 11 per cent in 2022 compared with 7.4 per cent on the Nigerian Stock Exchange (NSE), stressed the report.
The Lagos-based company recently completed a share buyback to boost value.
Dangote is one of only 35 billionaires among the richest 100 ranked on the Bloomberg Billionaires Index that have seen their fortunes grow in January. India’s richest person, Gautam Adani, is up the most, up $13 billion to $89.5 billion.
The Nigerian cement tycoon is set to boost his wealth by completing a $19 billion refinery project scheduled to start operations later this year. The crude processor has enough capacity to meet all the domestic fuel needs of Africa’s largest crude producer, while also boosting exports.