According to Bloomberg article published on May 23, 2023, Africa’s richest person commissioned the continent’s largest oil refinery, seven years late and at more than double the $9 billion cost initially planned.
The giant complex could be an answer to Nigeria’s woes, yet its citizens will have to wait a while longer to see the benefits.
Aliko Dangote, a cement and sugar magnate worth $20.5 billion, told a crowd of dignitaries in Lagos on Monday that his plant would supply its first product in July. The industry is skeptical.
There’s been no significant visible commercial activity indicating a major ramp up and, traders say, salespeople haven’t been hired yet to handle oil products.
Even the International Monetary Fund doesn’t see it reaching a third of its 650,000-barrels-per-day capacity in 2025. More likely, the commissioning was timed for Muhammadu Buhari to preside over a symbolic ceremony before he steps down as president next week.
Dangote will be closely watched to deliver the refinery and associated fertilizer plant in a country where several grand projects have failed. A case in point is the multi-billion dollar Ajaokuta steel mill on the banks of the Niger river that was started in 1979 but hasn’t produced any metal.
Putting aside the delay, the $20 billion refinery may finally resolve the travesty of Africa’s biggest crude oil producer having to spend more than $23 billion a year to import petroleum.
And, unlike in the past, it’s run by a billionaire who has made money from running businesses successfully, rather than siphoning off taxpayer money. Additionally, Nigeria’s state oil company, which owns 20% of the facility, committed to supplying 300,000 barrels of crude daily to the plant.
The Dangote refinery may have got off to a slow start, yet it has the potential to transform Africa’s biggest economy.
News Roundup
Tanzania wrapped up negotiations with international energy companies for a long-delayed $40 billion liquefied natural gas export project, paving the way for final agreements to be signed in the coming weeks. The consortium, led by Equinor, Shell and Exxon Mobil, wants to develop an onshore LNG plant in Tanzania, close to huge offshore gas fields. Project talks had stalled for more than a year before resuming in 2021, when President Samia Suluhu Hassan took office.
Zimbabwe’s President Emmerson Mnangagwa vowed to take action against private business, which he blames for fueling the southern African nation’s latest economic turmoil. The relationship between his administration and companies can be described as one of “trust betrayed,” he said, adding that while government has given many concessions to the sector in good faith, these haven’t been met with sincerity.
South Africa’s biggest opposition party is lobbying US lawmakers in a bid to preserve the country’s duty-free access to the world’s biggest economy amid a spat between the two nations over Russia’s invasion of Ukraine. John Steenhuisen, the Democratic Alliance’s leader, said in an interview he met with congressional and senate staff in Washington to persuade them that South Africa should continue benefiting from the African Growth and Opportunity Act.
The US suspects Russian mercenary firm Wagner Group is trying to ship weapons to fighters in Ukraine through Mali. Senior US officials have frequently condemned the group’s activities in Africa — particularly in the West African nation and the Central African Republic — for further destabilizing countries struggling with conflict.
Sudan’s warring sides agreed on a seven-day cease-fire starting Tuesday to allow the distribution of humanitarian aid and restoration of essential services, according to Saudi Arabia and US officials. The army and the Rapid Support Forces, a rival paramilitary group, signed a similar agreement in the past to protect civilians and facilitate the delivery of humanitarian aid, yet fighting raged despite the accord.
