Nigeria’s Petroleum Future: An Interview with Alhaji Aliko Dangote
Peter Uzoho
In a recent address at the inaugural Crude Oil Refiners Association (CORAN) Summit in Lagos, Alhaji Aliko Dangote, Africa’s richest man and the President of Dangote Industries Limited, articulated a bold vision for Nigeria’s oil refining capacity. He emphasized the need for Nigeria to develop a refining capacity of 1.5 million barrels per day (bpd) to achieve self-sufficiency in petroleum products.
Dangote disclosed that he constructed his monumental $20 billion refinery, which has a capacity of 650,000 bpd and is located in the Lekki Free Trade Zone, without any government incentives. This refinery, noted as both the world’s largest single-train refinery and the seventh largest overall, aims to shift Nigeria from a country reliant on imported petroleum products to a net exporter.
Since commencing operations in January 2024, the Dangote refinery has been producing a variety of white products, including diesel, aviation fuel, Naphtha, and most recently, Premium Motor Spirit (PMS), commonly known as petrol in Nigeria. At the CORAN Summit, he confirmed that the refinery is already producing enough diesel and jet fuel to meet local demand and is set to increase petrol production soon.
“We are exporting our products to several markets, including Europe, Brazil, the UK, the US, Singapore, and South Korea,” he stated, while stressing the importance of significantly boosting Nigeria’s refining capacity. Dangote emphasized that achieving the summit’s goal of transforming Nigeria into a net exporter of petroleum products will require substantial government support and collaboration among industry stakeholders.
“To capitalize on this opportunity, we need to build 1.5 million bpd of refining capacity. This will not be easy, and robust government backing will be essential,” Dangote remarked. Although he managed to build the Dangote Refinery without any government incentives, he stressed the need for future investors to receive encouragement from the government.
He pointed out that to ensure local refineries have enough feedstock, Nigeria must stop relying on external markets for its crude oil. “Unfortunately, while nations like Norway are investing their oil proceeds into future funds, in Africa, we are spending our future oil revenues. We need to focus on implementing domestic crude supply obligations,” he urged.
Moreover, he called for an expansion of Nigeria’s crude oil production capacity to meet the demands of new refinery capacities. President Bola Tinubu’s administration is reportedly taking active measures to facilitate this through accelerated divestments by international oil companies (IOCs) and additional initiatives.
Despite challenges, Dangote remains optimistic about Nigeria and Africa’s potential for self-sufficiency, drawing parallels with the country’s success in cement production. “If we can become self-sufficient in cement, we can certainly achieve the same in petroleum products,” he asserted.
To enhance Nigeria’s refining capacity and maximize the value of its oil resources, he urged the government to fully implement the Domestic Crude Supply Obligation as defined in the Petroleum Industry Act (PIA) of 2021. He reiterated the need for priority in expanding crude production capacity to match new refining capabilities.
“We are at a pivotal moment as global dynamics in the petroleum sector, particularly in Europe, threaten to disrupt traditional trade flows for refined products in Africa. However, Nigeria is well-positioned to seize this opportunity and emerge as a significant player in the global oil market,” Dangote concluded.
He expressed that being a vibrant exporter of refined products would significantly enhance Nigeria’s balance of trade and generate much-needed foreign currency. “Nigeria’s potential as a refining hub is undeniable. Let’s work together to bring this vision to fruition,” he encouraged.
