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HomeTop NewsCost of completing Dangote Refinery to hit $19 bln

Cost of completing Dangote Refinery to hit $19 bln

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The cost of construction of Dangote Refinery majorly owned by world wealthest blackman, Aliko Dangote,  will more than double the amount originally projected.

“Our capex will almost go to $19 billion by the time we finish,” Devakumar Edwin, group executive director of Dangote Industries Ltd., said in an interview broadcast on Arise TV News on Aug. 31.

The 650,000 barrel per day capacity refinery being built in Lekki area of Lagos, Nigeria’s commercial hub, was expected to cost $9 billion eight years ago, a price tag that had climbed to $15 billion by 2019.

The refinery is part of a vast petrochemical project that will also house the world’s biggest ammonia plant.

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Once operational, the facility is intended to curb, or even end, the nation’s dependence on fuel imports — a source of embarrassment for the government of Africa’s largest crude producer.

The refinery will be able to supply all the gasoline, diesel and aviation fuel used in the West African country, and a third of its output will still be available for export, Dangote told the Lagos-based television station.

Originally set for completion in 2016, the project is now expected to be commissioned in the second quarter of next year.

The Nigerian National Petroleum Corporation (NNPC), is in the process of buying a 20 percent stake in the plant for $2.7 billion.

The NNPC plans to borrow part of the money from the Cairo based African Export – Import Bank, will pay a third of the purchase price in cash.

Another third will be covered by supplying crude to the refinery, and the remainder “will be paid from the profit they are going to make from the business,” he said.

The NNPC said in June that the African Export-Import Bank is raising up to $1 billion to help it finance the acquisition.

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