Nigerian billionaire Aliko Dangote has announced his intention to sell the world’s largest refinery to the Nigerian National Petroleum Company Limited (NNPC). This move comes as the refinery faces ongoing issues related to the sulfur levels in its petroleum products and a series of misunderstandings involving Dangote Group, NNPC, and the Nigerian Midstream Downstream Regulatory Authority (NMDPRA).
Commissioned by former President Muhammadu Buhari, the $20 billion Dangote Refinery was envisioned as a solution to Nigeria’s dependency on petroleum imports and aimed to save approximately 30% of the foreign exchange spent on these imports. However, since commencing operations in January 2024, the refinery has encountered several difficulties.
Dangote, Africa’s wealthiest individual, has expressed frustration over his portrayal as a monopolist and has urged NNPC to buy his stake in the refinery. He remarked, “Nigeria has faced a fuel crisis since the 1970s. My refinery is poised to resolve this issue, but it seems some people are uncomfortable with that.”
The refinery’s challenges include disputes over crude oil supplies and allegations of monopolistic behaviour. Dangote has also highlighted issues with obtaining crude oil, noting that international oil companies (IOCs) often charge high fees and sometimes claim the commodity is unavailable. Reports indicate that NNPC supplied only 6.9 million barrels of crude oil to the refinery in May 2023, leading Dangote to consider sourcing crude from other African countries.
The strained relationship with NNPC is further compounded by financial concerns. Although NNPC holds a 20% share in the refinery, it has only managed to pay 7.2% of its commitment by the deadline set by the Dangote Group