An interesting Sunday with Aliko Dangote

I was one of the 102 senior journalists invited from all over the country to tour the Dangote Fertiliser and Petrochemical Refinery Complex last Sunday, and it turned out to be an unbelievably humbling and revealing experience. Unmistakably visible to us was the power of vision, determination to succeed in the face of many hurdles, and one man’s love for country. We were reminded that it is only we, Nigerians, that will develop ours, not some mythical ‘foreign investors’ that our leaders have been looking for. The visit lasted 11 hours, during which we went around every corner of the massive complex, which occupied 2,635 hectares of land (seven times the size of Victoria Island, Lagos). It is located in the Dangote Industries Free Zone (different from the Lekki Free Zone, which is owned by the Lagos State Government). In all, we probably covered most of the 112 km of road network crisscrossing the vast compound (some journalists termed it ‘The Dangote Planet’), walking, and being driven. On hand to lead the tour were Aliko Dangote himself (Group President), Edwin Devakumar (Group Vice President, Oil & Gas), and Fatima Dangote (Group Executive Director, Commercial).

Dangote informed us that the fertiliser, petrochemical, and refinery businesses would be quoted on the stock exchange in or before the first quarter of 2025 in what could be one of the biggest IPOs in recent years and that the NNPCL has only a 7.2 percent stake in the refinery, not 20 percent, as stated previously. ‘’Although we had offered them 20 percent, they could not pay for all of that, and so we had to reduce it to 7.2 percent, which they paid for’’, he said matter-of-factly. He spoke on the politics and economics of crude oil supply from the NNPCL, the $100 million payment to the Lagos state government, his encounters with shrines during construction, and the role of Ooni of Ife; why he did not build the refinery in the Niger Delta region, which is the nation’s hydrocarbon base; why Ogun State lost out as the initial location choice; why he has no home outside Nigeria; and his plans to reconstruct the Lekki expressway. He also announced that the company will soon move into its 18-story towers on Alfred Rewane Road, Ikoyi, not far from its current location.

We arrived at the refinery complex about 9.30 a.m. after a two-hour ride from the corporate headquarters of Dangote Industries Limited (DIL), Falomo, Ikoyi. The first port of call was a facility called Land Fall Point (LFP). ‘’Twenty-five kilometres from here into the ocean, we have our three single point moorings (SPM), where ships discharge crude oil into our subsea pipes’’, Devakumar said. An SPM is a floating buoy anchored offshore that allows the handling of liquid cargo in areas where dedicated onshore facilities for loading and unloading cargo are unavailable. From LFP, we went to the port and quays constructed by DIL with a load-bearing capacity of 25 tonnes per square metre to bring heavy and large cargoes close to the site to handle liquid cargoes. Soon, we were off to the fertiliser plant, where the pungent smell of urea welcomed us. The plant has an installed production capacity of three million tonnes per year, but it’s currently producing at half the capacity due to inadequate gas supply—the same problem that is plaguing Nigeria’s electricity supply and impeding production at NLNG.

The fertiliser plant is the largest in Africa and the second-largest in the world. Nigeria consumes one million metric tonnes of fertiliser per year, meaning that Dangote is able to meet local demand while the excess is exported to the USA, Brazil, and other places.

From the fertiliser plant, we dashed to the conference room, where Dangote gave detailed and comprehensive briefings on his businesses, right from their inception, detailing his transition from commodity trading in 1978 to a well-diversified conglomerate comprising cement, crude oil and gas exploration, agriculture, fertiliser, and petrochemical refineries. He appeared disarmingly simple, mild-mannered, and convincing. His voice was gentle, and there was no iota of indication that this was Africa’s richest man. I sat close to him, with Kayode Komolafe of Thisday (we call him KK), sitting between us. Even though I knew what the answer might be, I asked Dangote why he didn’t site the refinery in the Niger Delta. He said that would have made the investments less expensive, but he was frightened away by the volatility in the region. ”But, sir, Akwa Ibom State is peaceful. There’s no violence there. You should have come, Akwa Ibom’’, I pushed. Others chuckled, but Dangote contemplated my pitch briefly and said, “Yes. I know your governor. I saw him last week in Lagos…’’

We left the conference room to tour the refinery, the labs, and the control rooms. I didn’t know what to expect, but suffice it to say that the refinery is just a labyrinth of big pipes, running overhead in the open skies, without roofs, and on the ground and beneath the ground. It is a network of big and small pipes bending, twisting, and contorting all over the place, from its beginning at the Single Point Mooring 25 km offshore to the loading bay where refined products are pumped into tankers. As we walked around, I tapped Mr Devakumar at a point and asked, “Do you have an idea of the total lengths of all these pipes? I’m sure they’d run thousands of kilometers. “Yes’’, he answered. “We are inviting Guinness World Records to register it.’’Dangote chipped in, “They will have to come and audit it before they register and announce it.’’ We continued walking. This is the world’s largest single-train refinery, with the capacity to process 650,000 barrels of crude per day. It will meet all of our needs for refined products, with enough for exports. “It is a game changer,” exclaimed Devakumar.

After the refinery, we returned to the conference room for more briefings, Q&A, and lunch. There were questions on varied topics, including the impact of the energy transition on the sustainability of the refinery; title documents from Lagos State; and NNPC shareholding. One cheeky journalist asked if the Dangote refinery would also undergo the kind of turn-around maintenance that government-owned refineries have been experiencing, and another asked if Dangote knew why the Port Harcourt refinery had refused to work despite the billions of dollars pumped into its overhaul. The underlying mischief behind the two questions was obvious, and we all had a good laugh. I asked two questions on the politics of the supply of crude oil to the refinery by the NNPCL and whether he would take the refinery to the capital market. I had earlier made a note to ask Dangote about his relationship with the Tinubu administration, given the dramatic and embarrassing visits from the EFCC last year. But I changed my mind and dropped the question. Dangote addressed the questions one after the other. He said fossil fuels will be around for some time to come despite the drive for renewable energy and explained the need for NNPCL to supply domestic refineries with crude. He is optimistic that the guidelines recently announced by the NNPCL on crude supply will make a difference, adding, ‘’I hope the IOCs will respect the guidelines. Right now, we are paying a $6 premium on every barrel we buy from them, but luckily, our refinery was designed to refine different grades of crude, so we can actually buy from them everywhere. But importation brings in poverty and ships out jobs’’.

He said that the Lagos State government had insisted on being paid for the land in dollars, and he willingly paid the $100 million price. Although the government promptly issued the title documents, construction was delayed because of community issues. “You know they have a lot of shrines here…’’, he said. We laughed heartily. “But I must thank the Ooni for his kind interventions, which quickly resolved the issues’’, he added. The delay cost him $60 million in interest charges from the banks. The refinery was initially scheduled to be sited in Ogun State, but the state government delayed providing the land because the governor was making unethical demands. Dangote walked away and approached the Lagos State government. But the delay cost the company about $500 million in interest payments. That’s one of the negative outcomes of corruption.

By now, we were all tired, but nobody complained. The mood was convivial, and the conversation was interesting. The refinery currently employs 30,000 people, of whom 97 percent are Nigerians. The figure will go up to 100,000 as production ramps up. The plant will meet all of our domestic demands for liquid products (gasoline, diesel, kerosene, and aviation fuel). Currently, it is producing diesel and aviation fuel; petrol will be pumped out next month, Dangote assures. The group president says his refinery has been able to bring down diesel prices and may also moderate petrol prices at the pump, depending on variables like the source and price of crude and the exchange rate. The event closed with a passionate vote of thanks from Ms Fatima Dangote. She praised her father’s energy, commitment, and love for Nigeria and thanked Nigerians for their unceasing love for Daddy. We rushed back to our hotels to watch the England-Spain Euro final football game!

Source: Businessday