• Dangote Industries Chairman Aliko Dangote has started negotiations to secure billions in financing for his refinery
• The billionaire is reportedly in talks with banks and other lenders to secure funds to purchase additional crude oil for the facility.
• Africa Finance Corporation (AFC) has already invested in the refinery to help it get off the ground

Legit.ng’s Pascal Oparada reported on technology, energy, stocks, investing and economy for over a decade.

Aliko Dangote, Nigeria’s and Africa’s richest man, has begun negotiations to secure billions of dollars in additional financing to boost production at his $20 billion refinery.

The refinery is designed to change Nigeria’s energy landscape and reduce its dependence on imported petroleum products.

Dangote seeks to increase production through crude imports

Dangote is negotiating with several commercial and development banks, oil traders and other key industry players to raise funds to ensure stable and continuous supply to refineries.

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The Dangote refinery, facing strong competition from imported oil, seeks a loan to revive its operations

According to a previous report by Legit.ng, Dangote Industries sources its crude from the United States and Brazil and explore offers with African countries like Libya and Angola to meet growing demand.

The 650,000 b/d capacity refinery already produces 420,000 barrels per day, but the billionaire has set a goal of reaching full capacity by mid-2025.

The plant began producing diesel, aviation fuel and naphtha in September, then gasoline in October. He also agreed with local traders to sell gasoline.

Dangote enters into crude oil deal with NNPC

Efforts to ensure continued supply Nigeria The situation of the National Petroleum Company Limited (NNPC) has been complicated, leading the Nigerian government to initiate a deal to sell naira for crude oil.

The Financial Times reported that in December last year, Africa Finance Corporation (AFC) invested in the refinery to help it get off the ground.

However, Dangote now faces the challenge of securing additional funds to cover the refinery’s supply and operating costs, estimated at $2 billion every 90 days for a minimum daily supply of 300,000 barrels.

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Dangote refinery, marketers sign deal to extract 240 million liters of gasoline per month as NNPC imports

Dangote faces challenges due to naira volatility

According to reports, several lenders are concerned about Nairavolatility. The Nigerian government has devalued the naira, making financing and importing crude more expensive.

Despite the challenges, the world’s 46th richest man has pledged to use the megarefinery to meet Nigeria’s oil demand, estimated at 30 million to 35 million liters per day.

Experts predict that once operational, the refinery would reduce the need for imported fuel, which costs the federal government billions each year.

Dangote Cement seeks to borrow money from Nigerians

Legit.ng earlier reported that Dangote Cement received the board of directors Administrator approval to access medium- and long-term debt financing on domestic capital markets.

Proceeds from the bonds will refinance existing debt and working capital.

In the first nine months of 2024, the cement company reported a turnover of N2.5 trillion on the back of increased sales in local markets.

Source: Legit.ng