Dangote Seeks More Financing For Refinery As Cost Hits $19bn

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Africa’s richest man, Aliko Dangote is reportedly in talks with some financial institutions to secure a loan facility to finance the giant oil refinery complex project in Lekki, Lagos.

This is coming as the cost to complete the 650,000 barrel-per-day refinery shot up to $19 billion.

The refinery facility in Nigeria’s commercial hub was expected to cost $9 billion as at 2013, but however climbed to $15 billion by 2019. Following the insurgency of COVID-19 and some logistics delays, the price has again shot up to $19bn.

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This development was said to have prompted Dangote to source for funds to complete the mega refinery.

According to reports, Dangote held talks with executives from the world’s top two oil traders – Trafigura and Vitol a month ago.

Meanwhile, the purpose of the meeting remains sketchy as of now, as spokesperson for the Dangote Group did not respond to multiple requests for comment.

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Sources privy to the matter said Dangote, during meeting with the two oil traders discussed ways to complete the project as fast as possible. According to the source, Dangote is very keen on completing the project.

Recall that the Nigerian National Petroleum Corporation (NNPC) had agreed to buy a 20 per cent stake in the refinery for about $2.8 billion.

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NNPC’s head Mele Kyari said a process was on-going to raise $1 billion with Afreximbank to fund part of its stake purchase.

This development is coming amidst a recent report which claimed NNPC incurred a loss of N473.3bn in operating moribund refineries between January 2015 and February 2021.

The report had revealed that the NNPC incurred a loss of N473.3bn operating the refineries in Warri, Port-Harcourt and Kaduna.

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