Dangote Oil Refinery, a $19-billion integrated petrochemical refinery complex owned by Africa’s richest man Aliko Dangote, has been rescheduled to begin operations in mid-2023, as development works progress at the petrochemical complex.
The announcement was made by the Nigerian National Petroleum Company (NNPC), Nigeria’s only entity licensed to operate in the petroleum industry.
The news comes two months after Dangote Industries Limited opened an application to raise up to N300 billion ($723 million) to finance the group’s integrated petrochemical complex.
NNPC CEO Mele Kyari outlined the timeline for the petrochemical complex’s activities, stating: “Projection is first quarter, but we think it can come up by the middle of next year.”
The refinery project has been long hampered by a number of factors, including a lack of access to foreign currency, an ailing economy, and the COVID-19 pandemic, which disrupted supply chains and delayed the shipping of refinery equipment. Most recently, it also suffered from a lack of financing, which was resolved through N300 billion ($723 million) in medium-term debt funding.
The NNPC, which owns a 20-percent share in the integrated refinery and petrochemical complex, stated that it has first refusal to provide crude oil to the facility.
However, due to anticipated challenges in the country’s energy transition, the corporation secured the right to supply crude oil for 33,000 barrels at a minimum for the next 20 years, as well as access to 20 percent of the plant’s output.
In keeping with this decision, Kyari said the NNPC will stop importing refined goods next year once the 650,000-barrel-per-day refinery is operational.
Once completed, the refinery’s pipeline infrastructure will be the world’s largest vertically integrated plant, processing 540,000 barrels of Nigerian oil per day in the first phase of operation and increasing to 650,000 barrels per day afterwards.
The $19-billion refinery is expected to supply 100 percent of Nigeria’s demand for all refined goods, while also having a surplus of each of these products for export, creating a market for $11 billion in Nigerian petroleum products each year.
