NNPC To Acquire A Minority Stake In Dangote Refinery

The Nigerian National Petroleum Corporation (NNPC) has disclosed its plans to acquire a 20% minority equity stake in Dangote Refinery.

This acquisition is to further ensure an undisrupted supply of petroleum products across the country when the transaction pulls through.

 

According to Mr. Mustapha Yakubu, the NNPC's Chief Operating Officer of Refining and Petrochemicals, the negotiations for this acquisition with the Dangote Refinery are all being handled by the GRPD (Greenfield Refining Projects Division), a division under the NNPC.

Mustapha Yakubu was present at a 2-day Nigeria Oil and Gas Opportunity Fair (NOGOF), 2021, which was tagged “Leveraging Opportunities and Synergies for Post Pandemic Recovery of the Nigerian Oil and Gas Industry.”

 

In his speech, he said: “We have what we call the Greenfield refinery and the Greenfield Refining Projects Division (GRPD) of the NNPC. What we do, our strategy is to collaborate and seek strategic partnerships with private investors.

At the moment, we have Dangote Refinery, which is a 650,000 barrels per day capacity, plus a mini 80,000 tonnes per annum petrochemical plant.

What are we doing there? I can tell you today that we are seeking to have a 20 percent minority stake in Dangote Refinery as part of our collaboration and you know that there’s a huge quantity of crude for that refinery.

That’s 650,000 barrels, going into a single crude distillation unit (CDU). When that comes on board, it will also wet the nation for us.”

 

 

Yakubu also noted that the NNPC is collaborating with other refineries like the African Refinery in Port Harcourt, a co-location facility, the CNCEC Chinese group, which is interested in building two refineries in Nigeria, the Waltersmith modular plant and Azikel refineries on condensate production.

He stated that despite the global awareness for renewable energy, Nigeria has a local, domestic and regional market for hydrocarbons. Stating that Africa will continue to depend on fossil fuels at least in the next two decades.

According to Mustapha, Nigeria will not just sit back and do nothing with its hydrocarbons just because the International Energy Agency (IEA) has predicted a net-zero emissions scenario by 2050.

He said, “Today when you are bringing products into Nigeria, they disappear to neighboring countries. There’s nowhere in countries around Nigeria that they sell fuel for less than N400 per liter. So, there’s a market.’’

 

 

Dangote Refinery, which is still under construction, is a 650,000 BPD refinery owned by the Dangote Group. Upon completion, it is expected to be the largest oil refinery in Africa, and the world's biggest single-train facility.

This refinery project, which was announced in 2013, is set to be completed in 2021. It will meet Nigeria's refined petroleum product requirement and have a surplus for export. According to Dangote Group, the refinery will create some 9,500 direct and 25,000 indirect jobs.

 

Refinery Details

The Dangote Refinery is designed to produce up to 50 million liters of petrol and 15 million liters of diesel a day, roughly 10.4 million tonnes of the product, 4.6 million tonnes of diesel, and 4 million tonnes of jet fuel per year, in addition to having a fertilizer plant, which will utilize the refinery by-products as raw materials.

 

The processing facilities will include various units including a crude distillation unit and associated facilities, a mild hydrocracking unit, a residual fluid catalytic cracking unit, a naphtha hydrotreater, and a gasoline hydrodesulfurization unit as well as alkylation units.

The refinery will also have sulfur recovery and hydrogen generation facilities and a polypropylene unit. 

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