The 650,000 barrels per day Dangote Refinery is set to more than double its current refining capacity to about 1.4 million bpd, becoming the world’s largest refining facility.
President and Founder of the Dangote Industries Limited, Aliko Dangote, said the management of the $20 billion refining and petrochemicals complex is also thinking of altering its current business model and is set to list up to 10 per cent of its shares by next year.
“We have to build the refinery again, either here or somewhere else. But really, somewhere else is not possible because we’d have to go and spend so much building infrastructure, and we have the infrastructure already here,” Dangote said.
The refinery’s expansion plans involve building a second refinery with the same configuration, potentially with the addition of a vacuum distillation unit to boost light ends yields.
Dangote also plans to grow its annual polypropylene capacity from 1 million mt to 1.5 million mt in the next few years.
The company is considering a strategic partnership with Middle Eastern companies to expand the refinery and develop a new petrochemicals project in China.
“Our business concept is going to change. Now instead of being 100 per cent Dangote-owned, we’ll have other partners,” Dangote said.
The refining business will list 5 per cent to 10 per cent of its shares on the Nigerian Stock Exchange within the next year.
“We don’t want to keep more than 65 per cent to 70 per cent,” Dangote said, explaining that shares will be offered incrementally subject to investor appetite and market depth.
Dangote rejected a model that leaves Africa dependent on imported fuel, saying he remains determined to disrupt a market shaped by economies of scale.
“Most African governments will not have the capacity to build a refinery,” Dangote said, calling smaller projects “a drop in the ocean.”
The company has resolved most of the problems with the refinery’s main petrol engine, the Residue Fluid Catalytic Cracker, and plans to shut it down for a month-long turnaround soon.
Dangote said the company has committed to finding new employment for all 800 dismissed workers, mostly outside the refining business, following a labor strike in September.
“We don’t have any worries with the unions,” Dangote said, sharing that the reorganisation was almost complete and deemed sufficient to abate recent tensions.
