Good News! Dangote Set To Build $8 Billion Refinery As FG Grants Licence

 

 

The quest by Africa’s richest man, Aliko Dangote to make an intervention in Nigeria’s long standing fuel supply hiccups is being pursued vigorously with advance orders believed to have been made for equipment  that will be used to build his proposed $8 billion refinery and petrochemical plant in Lekki, Lagos. It was  learnt yesterday that the orders for these equipment were made ahead of Government granting a Licence-To-Establish (LTE) a refinery which Dangote received only a few days ago.

The equipment ordered include ‘Long Lead Items’ and a power plant, which ordinarily would take between 18 and 21 months from time of order to time of delivery. It is anticipated that these advance orders may cut short the take-off time of the project. The Dangote Refinery and Petrochemical Plant is scheduled to become operational in the third quarter of 2017 and would have the capacity to process 400,000 barrels of petroleum per day.

Nigeria currently consumes 40million litres per day of Premium Motor Spirit (PMS) otherwise known as petrol, the bulk of which is imported from Europe because the country’s four refineries are hardly functional much of the time.

The licence was issued to the  company by the  Department of  Petroleum  Resources  (DPR ) and basic engineering work is expected to be completed in January next year. The next step would be detailed engineering work, which would involve structural, mechanical, civil and electrical aspects and procurement.

Commenting on the development, a stakeholder  in the downstream sector of the  oil and gas  industry  who  does  not  want his name mentioned, said it portends well. "It is a good development because I have always said that the private sector must be allowed to do the business of petroleum refining. However, some questions must be asked. What price is the company going to sell the products at? What price is the company going to buy the crude oil from government at?”

He added that if  the company is going operate at the Export Processing  Zone (EPZ) ,it would mean that it would sell the products at  the going international price, which he said would end up higher than current pump price.