Marketers, experts welcome expansion of Dangote refinery’s capacity to 1.4m bpd

President/Chief Executive, Dangote Industries Limited, Aliko Dangote, has announced the expansion of his refinery’s daily production capacity from 650,000 per barrels to 1.4million bpd. Dangote, flanked by his friend and foremost entrepreneur, Femi Otedola, disclosed this at a press conference in Lagos on Sunday. He said the expansion drive when completed will make the refinery […]

President/Chief Executive, Dangote Industries Limited, Aliko Dangote, has announced the expansion of his refinery’s daily production capacity from 650,000 per barrels to 1.4million bpd.

Dangote, flanked by his friend and foremost entrepreneur, Femi Otedola, disclosed this at a press conference in Lagos on Sunday.

He said the expansion drive when completed will make the refinery the world’s largest, surpassing India’s Jamnagar Refinery with a capacity of 1.24m bpd.

Dangote said the expansion process will take three years to complete.

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He said, “The key announcement is that we are expanding the Dangote Refinery from 650,000 barrels per day to 1.4m barrels per day.

“This will make it the largest refinery in the world ever.

“This expansion reflects our confidence in Nigeria’s future, our belief in Africa’s potential and our commitment to building energy independence for our continent and the world.”

With the expansion, he said the refinery will require  65,000 workers during the construction process.

Dangote added that the refinery would also ramp up its power generation from 500MW to 1,000 MW capacity.

Dangote noted that the refinery would be listed on the Nigerian Stock Exchange in 2026, in order  to give Nigerians the opportunity to be shareholders.

“That’s a step towards broader ownership and market transparency. We want to give all Nigerians the opportunity of owning parts of the refinery.

“You can buy as many shares as you can. Therefore, we are making sure that this refinery belongs to all Nigerians. I think it’s right time to put in your savings and join us in this journey.

“Our long term goal remains clear – to build Africa’s leading integrated energy and petrochemical hub, the first of its kind on the continent,” he said.

Dangote added that the project will be financed through cash flow, “and we also have one or two strategic investors.”

 

Polypropylene production climbs 2.4 mm metric tonne per annum

Dangote also disclosed that with the expansion, the polypropylene production will move up from 900,000 metric tonnes to 2.4m annually.

He also said the drive will take the refinery transitions from producing Euro V to Euro VI fuel standards, meeting the highest global environmental benchmarks.

“We will also be expanding our Polypropylene production from 900,000 metric tonne to 2.4 mm metric tonne per annum this will further enrich the production of linear alkylbenzene, a key ingredient for the production of detergent, and additional production of base oils.

“With this expansion, the refinery transitions from producing Euro V to Euro VI fuel standards, meeting the highest global environmental benchmarks.

“Expands power generation capacity, ensuring full operational self-sufficiency,” Dangote said.

He added that “Over 85% of our workforce will be Nigerian, with ongoing investment in skills and technology transfer.

“We remain committed to safety, sustainability, and local participation at every stage of this expansion.

“Our goal has never been just to refine oil, but to refine opportunities for our people,” he added

 

‘Crude supply shouldn’t be an issue’

Responding to questions on the challenge of crude oil supply in view of the expansion, he said such shouldn’t be an issue.

“All that’s happening right now, we are exporting the crude which is being produced in the African continent and importing finished products.

“For once, at least we have something that we are refining. We can also send poverty to them and create jobs where we are.

“Crude supply shouldn’t be an issue. We have already worked out our numbers and I think we are good.”

 

…Challenges DAPPMAN to take over existing refinery

Speaking further, Dangote challenged the Depot and Petroleum Products Marketers Association of Nigeria, (DAPPMAN) to take over some of the existing refineries in the country in order to curb reliance on importation.

He said, “Talking about monopoly… you have a group like DAPPMAN. They should go and buy some of the refineries. If they’re not for sale, then they should actually go and start their own refinery. “It’s better when you are playing football,  it is better if everybody plays football,  not that some people will be playing football,  but somebody will be playing cricket.

“So, I think it is far better for other people to go and buy so we will not be the only one supporting Mr. President’s policy.

“The president has been supporting the sector to refine all our crude into petroleum products, and I think other people too should take the opportunity.”

 

…Commends Tinubu’s policies

He expressed gratitude to President Tinubu and the Federal Government for supporting industrialisation policies such as Nigeria’s First, Naira-for-Crude, and the One-Stop Shop initiatives, which he said have emboldened investors to take on transformative projects.

He also commended the government’s intervention in mediating recent disruptions at the refinery linked to union activity and sabotage attempts, calling it a demonstration of effective collaboration between the public and private sectors.

Despite not yet recouping the initial investment in the 650,000 bpd phase, Dangote said the group is focused on long-term transformation rather than short-term returns.

“Refining is a long-term project. We are expanding because we believe in Africa,” he said, adding, “Without this refinery, Nigeria would still be buying dollars at ridiculous rates and depleting our reserves to import fuel.”

He emphasised that Nigeria’s pump price remains among the lowest in the region despite the refinery’s production of higher-quality, cleaner fuels that have reduced toxic dumping in the country.

Dangote emphasised that the refinery has already made a difference by stabilising local fuel supply, helping to strengthen the naira, and preventing capital flight.

“Nigerians today buy petrol at roughly half the price of what our neighbours pay, and it is even cheaper than in Saudi Arabia,” he noted. “Our product is of higher quality, meeting Euro VI standards, and it has significantly reduced the dumping of toxic fuel into our market.”

 

Marketers, stakeholders welcome expansion

Speaking with one of our correspondents, President of the Independent Petroleum Marketers’ Association of Nigeria (IPMAN), Alhaji Abubakar Maigandi welcomed the expansion of the refinery by Dangote, saying it would ensure product availability.

Describing the coming of Dangote Refinery as a blessing for Nigeria, he said importation of refined products should have stopped by now.

He said, “Now we have seen the benefits of the refinery, all Nigerians are seeing the benefits. It is a good thing that he is expanding the refinery. If not because of the desperation of some people, with what Dangote Refinery has been doing, we should have stopped importation.

A major marketer said, “It would be one of the biggest in the world. It means he will produce more than Nigeria needs, so he has to be competitive with other global refineries.”

On his part, Professor Emeritus of Petroleum Economics, Wumi O. Iledare, said the new capacity of the Dangote Refinery, if managed efficiently, can generate true economies of scale by lowering unit costs, deepening regional trade, and enhancing foreign-exchange stability.

He, however, said without strong governance and regulatory discipline, the same scale advantage can quickly turn into diseconomies and market dominance.

“With no import backstop, there is a genuine risk of absolute monopoly power, where price and supply decisions become concentrated in one entity. To avoid that, the government must sustain transparent regulatory oversight, maintain import-parity benchmarks, and encourage other refineries to operate competitively.”

He added that in the long run, the test of the expansion will not be size, but efficiency, transparency, and shared value creation.

“Scale must serve society — not control it. When scale breeds dominance, governance must breed fairness.”

Speaking with Daily Trust, Prof. Dayo Ayoade, Energy Law expert at the University of Lagos, said, “Of course, if they can produce more, fine for them, they can make a lot more money. But also, it means that they would have to find crude oil in substantial numbers from what they currently do.”

He added that the crude oil may not come from Nigeria and the refinery will have to do a lot more imports of US crude oil or crude oil from all over the world.

“And that would be a very big cost for Dangote refinery. Other implications have to do with the technical aspect as the capacity to take on board this huge number of cargoes, capacity to produce the various products from the crude oil and then sell and market those products on international markets, whether it’s jet fuel, whether it’s diesel, whether it’s petrol, kerosene or what have you. So, it’s a lot to do. As to whether we should continue to import, we may have to continue to import because of energy security.”