Aliko Dangote, Chairman of the Dangote Group, announced that his $20 billion refinery in Lagos, which processes 650,000 barrels per day, will help reduce fuel prices in Nigeria. He shared this at a recent forum in The Bahamas.

When asked if the refinery would lower petrol prices, which are currently around N700 per liter, Dangote did not give a definite answer. However, he pointed out that the price of diesel dropped from N1,700 to N1,200 when his refinery supplied the market.

Dangote mentioned that his refinery has a storage capacity of 4.78 billion liters for refined products. He also claimed that international oil companies refused to sell crude oil to his refinery to prevent its success.

Because of this, the Dangote Refinery has turned to the US for a monthly supply of 24 million barrels of crude oil. As a result, the refinery has delayed the start of fuel supply to July 10-15, 2024, from the initial June date.

He said,

“The issue of gasoline is certainly a different issue. That one is being dealt with by the government. But let me give you an example. In diesel, which the industries, transporters and everybody consume; when we first started, it was N1,700, and the dollar conversion was about N1,200 then. Immediately when we started, within two weeks we brought down the price to N1,000. We took it from N1,700 to N1,200 and from N1,200 to N1,700, we have given more than a 60 percent drop in price.

“With the currency now back up to about N1,500 per dollar, the price is still below N1,200. That’s a big improvement, from N1,700 to N1,200. And the diesel is available, we are not living from hand to mouth anymore,” Dangote replied when asked about a possible petrol price cut.

“The country doesn’t have strategic reserves in terms of petrol, which is very dangerous. But in our plant now, when you came, we had only 4.78 billion liters of various tankage capacity. But right now, we’re adding another 600 million.

“So effectively, as we go forward, the refinery will be the strategic reserve of the country in terms of petroleum products,” 

Dangote alleged that the reason why international oil companies refused to sell crude oil to his refinery was that they did not want him to succeed.

“And I think that is the process that we’re now really going through. But the truth is that, yes, the country, the sub-region, and also the continent, of sub-Saharan Africa, need this refinery. So, you expect them to fight through non-supply of crude, non-purchase of the product, but I think it’s all temporary. We’ll get there,”