July 22, (THEWILL) – Recent events have put Dangote Petroleum Refinery and Petrochemicals Company Limited under pressure, causing the founder — a man not known for many words, but plenty of actions – Alhaji Aliko Dangote, to mount the stage to speak.
His reactions to several issues attempting to undermine his dream of attaining a global spotlight, demonstrate the determination to achieve unusual success in an unusual endeavour. Moreover, coming in torrents of successive intervals could cause even the strongest mortal to surrender. This is more remarkable at a time the world awaits the success story of an enterprise in a continent not known for the level of development that Dangote Refinery and Petrochemical Company aims to attain.
At the eleventh hour to attaining actual, full production, the world is being told that the land where the facility stands requires an explanation as to how it was acquired ab initio. Reacting to insinuations that the man behind the dream may have used his influence to grab the vast spread of land gratis, Dangote himself revealed during a recent press conference that his firm paid $100 million to the Lagos state government for the land.
Alhaji Aliko Dangote, who is Chairman of Dangote Industries Limited (DIL), disclosed that he paid $100 million to the Lagos State government to acquire the land on which Dangote Refinery was built, contrary to the belief that it was offered to him free as an incentive.
Speaking over the weekend, Africa’s richest man clarified: “In the refinery, we did not, and I repeat, we did not collect one single incentive from the Federal Government of Nigeria or even Lagos State. Yes, the Lagos State gave us a good deal but we paid $100m for the land. It wasn’t a free land; we paid for it.”
This came a few days after Dangote was accused of steering the sheep of monopoly in the murky waters of Nigeria’s sullen business environment.
Addressed allegations of monopoly against his business conglomerate, Dangote stated that the company’s operations add value by utilising local raw materials which \is a priority towards industrializing the economy.
“If you look at all our operations at Dangote (Group), we add value; we take local raw materials and turn them into products, and we sell. We have never consciously or unconsciously stopped anybody from doing the same business that we are doing,” he asserted.
He further dispelled the monopoly claims by referencing the cement industry. “When we first came into cement production, it was only Lafarge that was operating here in Nigeria…Nobody ever called Lafarge a monopoly,” Dangote remarked.
He underscored that a true monopoly would involve blocking competitors through legal means, which he insisted his company has never done. “It is a level playing field whereby whatever Dangote was given in cement, for example, other people were given because some of them even got more than us,”
Perhaps, the most stunning revelation was that the Nigerian National Petroleum Company Limited (NNPCL) stake in the refinery has reduced to 7.2 percent from the 20 percent that NNPCL told Nigerians.
Speaking during the media parly, Dangote said NNPC now owns 7.2 percent of the refinery over failure to pay the balance of their share, which was due in June.
“NNPC no longer owns a 20 percent stake in the Dangote refinery. They were meant to pay their balance in June, but have yet to fulfil the obligations. Now, they only own a 7.2% stake in the refinery,” Dangote said.
The NNPCL had in September 2021 announced that it acquired a 20 percent interest in Dangote refinery for $2.76 billion. Revealing details of the transaction, NNPC, in its audited financial statements for 2022, said NNPC Greenfield holds the investment.
NNPC said the balance ($1.76 billion) of the cost of equity investments made in Dangote refinery would be paid upon completion of the refinery project or any other date agreed. From the latest revelation, that deal failed to happen, leading to questions being asked by many Nigerians why NNPCL failed to actualise that deal.
The company had earlier reacted to the allegations by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) that the refinery is producing products of low quality.
Dangote, in a statement to newsmen, said the refinery’s products not only comply with set standards but have also surpassed those of its contemporaries, with a per million (ppm) measurement now at 32. The business mogul said the refinery was initially producing around 665 ppm of product, which was considered the best quality at the time.
THEWILL reports that the full leadership of the House of Representatives, on Saturday, toured the Dangote Refinery complex in Lekki, Lagos, on a fact-finding mission, following the controversy over the refinery’s inability to secure crude cargoes from the Nigerian National Petroleum Company Limited and oil producers in the country.
The Speaker of the House, Tajudeen Abbas and his Deputy, Benjamin Kalu, led 13 other members on the tour and that on their way to the facility, the convoy detoured into two fuel stations (Matrix and Total) at the directive of the Speaker, to collect samples of diesel sold to the public.
At the refinery complex, they also collected samples from diesel refined at the plant and subjected the three samples to a test at the Dangote laboratory in the presence of the press.
Result of the test shows all crude-based products contain some level of sulphur, the sulphur content in the diesel from Matrix was above 2,631 ppm and that of Total was 1,829 ppm; much higher than the recommended level while the tests for the flash point showed results of 26 and 63 respectively. Both results fell short of the recommended minimum of 66. The results for the diesel from Dangote turned out to be 87.6 ppm for sulphur and 96 flashpoints.
THEWILL gathered that the lower the sulphur content, the better the quality of diesel as high sulphur levels cause damage to engines and vehicle components.
For Dangote, the result does not only show the reality of products from his refinery, but also shows that substandard petroleum products are being imported into the country and sold to unsuspecting Nigerians.
Perhaps, Dangote Refinery and Petrochemical Limited is at the verge of launching into full production that will alter Nigeria’s ugly energy narrative and place the company on the global spotlight it aims at.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
