Wednesday, 17 April 2013

# Africa News # Dangote

Dangote set to build $8 billion oil refinery in Nigeria

                         Aliko-Dangote
Africa Richest Man: Aliko Dangote has announced plans to invest about $8bn to build a 400,000 bpd capacity oil refinery in Nigeria by 2016.

Dangote, disclosed this to Reuters saying that sub-Saharan Africa need investments in this area.

According to projection, if completed, this will double Nigeria’s current refining capacity.

“This will really help not only Nigeria but sub-Saharan Africa. There has not been a new refinery for a long time in sub-Saharan Africa,” Dangote said in a telephone interview.


The country currently has the capacity to produce some 445,000 barrels per day among four refineries, but they operate well below that owing to decades of mismanagement and corruption in Africa’s leading energy producer.

Nigeria, the continent’s second-biggest economy, relies on subsidised imports for 80 per cent of its fuel needs.

Dangote maintained that building such a high capacity refinery in Nigeria is important saying, “In five years, when our population is over 200 million, we won’t have the infrastructure to receive the amount of fuel we use. It has to be done,” he reportedly said.

The Dangote Group’s cement manufacturing, basic food processing and other industries have helped lift his personal fortune to $16.1bn from $2.1bn in 2010, according to the latest Forbes estimate.

Nigeria has two refineries in its main Port Harcourt oil hub, one in the Niger Delta town of Warri, and one in Kaduna in the North that serve 170 million people. Not one of them functions at full capacity.

Analysts have said previous attempts to get the refineries going have been held back by vested interests such as fuel importers profiting from the status quo. Dangote said this concerned him.

He voiced out his concern over the dangers an investor might face in operating a refinery in the country saying, “The people who were supposed to invest in refineries, who understand the market, are benefiting from there being no refineries because of the fuel import business. Some… are going to try to … interfere,” he said.

Dangote said making a new refinery run at a profit would work even if the government failed to scrap the subsidised fuel price that has deterred others from investing.

“We’ve done our numbers and the numbers are okay,” he said.

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