We have enough fuel to give to at least the entire West Africa, Brazil and Mexico – Dangote

Aliko Dangote, Africa’s richest man and President of Dangote Group, has assured that Nigeria will no longer need to import gasoline from next month, following the operational plans of the Dangote Refinery. The refinery, which began commissioning in February, is expected to meet not only Nigeria’s fuel needs but also those of the wider African market.

Speaking at the Africa CEO Forum in Kigali, Rwanda, Dangote highlighted the refinery’s capacity to supply West Africa’s petrol and diesel needs and the entire continent’s aviation fuel demand.

“We have enough gasoline to give to at least the entire West Africa, diesel to give to West Africa and Central Africa. We have enough aviation fuel to give to the entire continent and also export some to Brazil and Mexico,” Dangote stated.

The refinery’s output will also include polypropylene and polyethylene, essential for various industrial applications, as well as base oil and linear benzyl, key raw materials for producing detergents. Dangote said that Africa currently imports these materials, and his refinery aims to make the continent self-sufficient in their production.

The entrepreneur also outlined his vision for Africa’s self-sufficiency in fertilizers, with plans to double the production of urea to six million tonnes within twenty months. This capacity will match Egypt’s entire output, positioning Africa to stop importing fertilizers entirely.

“As I said, give us three or a maximum of four years and Africa will not, I repeat, not import any more fertilizer from anywhere. We will make Africa self-sufficient in both potash, phosphate, and urea, we are at three million tonnes and in the next twenty months, we will be at six million tonnes of urea which is the entire capacity of Egypt. We are getting there,” he said.

Economic Impact and Job Creation

The Dangote Refinery is expected to have a substantial impact on Nigeria’s and Africa’s economies by reducing reliance on imported petroleum products, creating jobs, and fostering industrial growth. Dangote highlighted the strategic importance of producing finished products locally to avoid exporting jobs and importing poverty.

“One of the things we also need to know as Africans is that we produce raw materials and export them, when you export raw materials and somebody now keeps importing things into your continent and dumping goods. What you are importing is poverty and exporting jobs out. So, we have to change that narrative,” he explained.

Amidst the progress were behind-the-scene challenges faced in building the refinery. Dangote acknowledged these challenges, particularly opposition from those accustomed to the status quo of trading without refining.

“The pushback was very impactful because there are people who have actually been used to just making money trading without refinery and you know, to get people who are committed to Africa has to be people that believe in investing in Africa because the companies that are operating today are actually not investing, and some of the issues of stopping that investment is going to impact us, not today but in the future, which means our oil production will continue to go down because in oil, unless you keep investing, the production is going to go down.

“So, that is the issue. The major burden on us was that there is no room for failure because we were the EPC contractors and ninety percent of people never believed that we were going to deliver but we have been able to deliver now,” he said.

Despite the successes, Dangote identified policy inconsistency as a significant hurdle for African entrepreneurs and called for supportive measures from leaders to ensure a conducive business environment.

Collaboration with TotalEnergies

In a related development, Patrick Pouyanne, CEO of TotalEnergies, announced a deal to supply crude oil to the Dangote Refinery. This partnership with one of Nigeria’s major crude producers, alongside Shell and ExxonMobil, is expected to address the concern of crude oil supplies to the refinery.

“The two CEOs met with our head of trading and we found the way to convince them to make a deal,” Pouyanne said.

Looking ahead, Dangote revealed that the next phase of the refinery’s expansion would begin early next year, further enhancing its capacity and impact on the African market.

While the Dangote Refinery represents a transformative project for Nigeria and Africa, aiming to make the continent self-sufficient in key industrial products and significantly reduce its dependency on imports, the major concern of consumers hinges on the cost.

With the cost of petroleum hitting the roof across West Africa, given the earning power of consumers, hope has been entertained that Dangote Refinery will bring a reprieve by cutting down the pump price of petroleum – especially in Nigeria where the government is still paying subsidies. However, challenges in the Nigerian oil sector, which currently limits oil production to barely 1.281mbd – forcing the refinery to source crude from the US, have cast a shadow on that hope.

Consumers can only wait and see whether there will be a favorable difference when the refinery begins to function at full capacity. Since its product costs are expected to reflect international prices, the cost impact on local markets remains uncertain.