Aliko Dangote, Africa’s richest man, has announced that the Nigerian National Petroleum Company (NNPC) Limited now holds a 7.2% stake in the Dangote Petroleum Refinery, down from the initially declared 20%.
According to him, the reduction is due to NNPC’s failure to pay the balance of their share, which was due in June.
Speaking at a press briefing on Sunday, Dangote explained, “NNPC no longer owns a 20 per cent stake in the Dangote refinery. They were met to pay their balance in June, but have yet to fulfil the obligations. Now, they only own a 7.2% stake in the refinery.”
Initially, NNPC had acquired a 20% interest in the $20bn refinery for $2.76 billion.
The NNPC confirmed the stake adjustment in a statement, with a spokesman saying, “NNPC Limited periodically assesses its investment portfolio to ensure alignment with the company’s strategic goals. The decision to cap its equity participation at the paid-up sum was made and communicated to Dangote Refinery several months ago,” said Olufemi Soneye.
Nigeria, Africa’s most populous nation, continues to grapple with energy challenges, relying heavily on imported refined petroleum products due to non-operational state-owned refineries.
This reliance has led to frequent fuel queues and significant price increases following the removal of the fuel subsidy in May 2023, further straining citizens who depend on petrol for vehicles and generators amid inconsistent electricity supply.
Last December, Dangote began operations at his $20bn refinery in Lagos, initially processing 350,000 barrels per day, with plans to reach full capacity of 650,000 barrels per day by year’s end.
The refinery has started supplying diesel and aviation fuel domestically, with petrol supply set to commence in August.
Dangote had expressed frustration over sourcing Nigerian crude for his facility, revealing that the refinery had to purchase about 24 million barrels of crude from the United States.
This was partly due to NNPC pledging Nigerian crude in a $3.3 billion oil-for-loan Afreximbank deal, limiting local supply.
However, he disclosed on Sunday that the refinery’s petrol production would start in August 2024, following a resolution of crude oil supply issues with the NNPC and the Federal Government.
