Dangote Seeks Billions in Loans to Bolster Crude Supply - Report
- Esther
- Nov 18, 2024
- 2 min read

Africa's wealthiest individual and a prominent Nigerian business magnate, Aliko Dangote is actively seeking billions of dollars in loans to enhance crude supply for his newly established $20 billion oil refinery located on the outskirts of Lagos.
This ambitious project, which is one of the continent's most massive infrastructure undertakings, aims to transform Nigeria's energy landscape by reducing its dependency on imported petroleum products.

According to reports from the Financial Times, Dangote is engaged in discussions with a variety of financial entities, including commercial lenders, development banks, and oil traders, to secure the necessary funding.
The goal is to ensure a stable and sustained supply of crude oil for the refinery, which has the capacity to process up to 650,000 barrels per day (bpd) once fully operational. Currently, the refinery is producing 420,000 bpd, with plans to reach full capacity by mid-2025, despite previous delays.
The refinery, situated at the Lekki Free Trade Zone in Lagos State, is supplied with crude oil through the world's largest sub-sea pipeline infrastructure, spanning 1,100 kilometers. However, securing a steady flow of crude has been challenging due to issues with the Nigerian National Petroleum Company Limited (NNPC), which is supposed to supply a significant portion of the required crude.
In recent meetings, Dangote sought assurances from President Bola Tinubu and Mele Kyari, CEO of NNPC, to ensure a reliable supply of 365,000 bpd of crude, to be paid for in Nigeria's devalued currency, the naira.
Despite these challenges, Dangote remains committed to using the refinery to meet Nigeria's entire demand for petrol, estimated at 30 to 35 million liters per day. Once fully operational, the refinery could significantly reduce the need for imported fuel, which costs the Nigerian government billions annually.
A report by the Knightsbridge Strategic Group (KSG) suggests that the refinery could eventually help reduce fuel costs in Nigeria and increase competition in the European fuel market, potentially positioning Nigeria as a major exporter of refined oil products.
However, persistent crude shortages and the weakened naira pose ongoing challenges. The KSG warns that these issues could prolong the refinery's struggle to reach full capacity, projecting that it may not achieve this until at least the second quarter of 2025. The government's failure to resolve these issues could lead to rising inflation, increased fuel prices, and potential social unrest, exacerbated by the removal of fuel subsidies earlier this year..
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