Dangote’s biggest dream is for Nigeria to make history as the largest exporter of petroleum products and exporter of fertilizer in Africa. And he is one step closer to that dream as his fertilizer plant commenced commercial sales of Urea, officially on Monday, June 7, 2021. The Urea was produced for local consumption and export as well. This move has been described as
one that would liberalize the fertilizer market, enhance the agricultural industry and also earn the much-needed scarce foreign exchange for Nigeria. This plant, which actively churns out 3 million metric tonnes of Urea annually is the biggest fertilizer project in the world.
The name Dangote is globally recognized, one that has made him the 100th richest person in the world, the richest black person, and the richest man in Africa, according to Forbes. Alhaji Aliko Dangote made most of his wealth from Dangote Cement, the largest cement producer in Sub-Saharan Africa where he owns 85.2% majority stake. But that is not all, the Dangote Group, which was launched in 1981, owns and operates more than 18 subsidiaries which include, Dangote Cement, Dangote Flour, and Dangote Sugar. And later, Salt, Textiles, Steel, Oil and Gas, Packaging, Seasoning, Pasta, Beverages, Logistics, Agriculture and Property Development and Port Management, etc. Dangote Group currently employs over 30,000 staff across Nigeria and West Africa.
He also recently put Nigeria on the global map with the commissioning of his fertilizer plant on 5th June 2021 and it commenced sales on 7th June. This feat automatically makes Nigeria the biggest Urea exporting country in sub-Saharan Africa and the biggest producer of polypropylene and polyethylene.
Dangote, whose businesses operate mostly from Lagos, Nigeria has lived in Lagos for over 30 years, right after he graduated from Al-Azhar University in Egypt with a Business Degree in 1977. Being that he was raised by an entrepreneurial maternal grandfather, Dangote took a $500,000 loan from his uncle Dantata and started trading in bagged cement, rice and sugar. His entrepreneurial skills came to the fore and he was able to repay his uncle three months after he started the business. Today, the Dangote Group is the largest conglomerate in West Africa and the African continent, currently worth over $14 billion. His business interests made him go into manufacturing, he built a sugar refinery and a flour mill in 1999, and his business grew to the point that Dangote Sugar debuted on the Nigerian Stock Exchange in 2010 and generated sales revenue of $450 million, while Dangote Flour also gained $270 million. He also set up Blue Star Services, through which he imported baby food and aluminum products until the import license era was stopped.
Dangote as a businessman has always looked at the big picture and so in all of his businesses, he has never been contented with the comfort zone. This can be said when he first started the textile weaving mill in Kano, he soon set up a textile plant in Lagos. The same story with the cement factory which he started in Obajana, Kogi State, and soon started another one in Ibeshe, Ogun State, and acquired the capacity to produce 8 million tonnes of cement from those ventures. Then he expanded into other African countries, in Benin, Cameroun, Ghana, South Africa, Zambia, and Tanzania, with a market capitalization of $14 billion in the stock market. Today in Zambia, there’s a cement plant in Ndola which was built by Dangote Group in 2015 and can produce 1.5 million metric tonnes of cement annually. Dangote Cement is currently in 14 countries across Africa. Dangote Sugar is another major player in the sugar industry and has the largest sugar refining company in sub-Saharan Africa.
Dangote hopes to float Dangote Cement in London by end of 2021, but that would be run by independent directors, including Tony Blair’s wife Cherie, who understand the London business terrain perfectly.
DANGOTE REFINERY
Dangote’s foray into the downstream sector started in 2016 when he signed a contract with the CNOOC group for the installation of a large underwater offshore pipeline. The pipeline, when completed is expected to extend from Bonny (Rivers State) through Ogedegbe, Olokola to Lekki, and the Escravos Lagos pipeline, finally terminating at the West Africa Gas Pipeline. Then the Dangote Group established a 3 million tonnes fertilizer plant, which also thrived alongside the other businesses.
The latest venture, which is the Dangote Refinery started in 2016 and is expected to be completed in 2022. The refinery would have the capacity to refine 650,000 barrels of oil daily and will be the largest refinery in Africa. For a country that relies solely on imported refined fuel products, because the local refineries are working below capacity. One thing the Dangote Refinery will do for Nigeria is to increase its refining capacity, meet up the domestic demand and also generate foreign exchange for Nigeria through exports of its downstream products. The Dangote refinery is expected to produce 10.4 million tonnes (Mt) of gasoline, 4.6Mt of diesel, and 4Mt of jet fuel a year. They will also produce 0.69Mt of polypropylene, 0.24Mt of propane, 32,000t of Sulphur, and 0.5Mt of carbon black feed annually.
Dangote Refinery currently sits on a 2,635ha site on the Lekki Free Zone in Ibeju Lekki, off the coast of the Atlantic Ocean. It is expected that its location will aid easy shipment of refined petroleum products outside Nigeria, and there is also a jetty near the refinery, built by Dangote through dredging the seabed for 65m cubic meters of sand, which can receive heavy equipment for the refinery construction since there was none that had such capacity before now.
The refinery’s facilities include a crude distillation unit (CDU) and associated facilities, mild hydrocracking (MHC) unit, a residual fluid catalytic cracking (RFCC) unit, a naphtha hydrotreater, and gasoline hydrodesulfurization (HDS) unit, as well as alkylation units. The refinery complex also houses sulfur recovery and hydrogen generation facilities and a polypropylene unit. Comprising two steam methane reformer (SMR) units, the hydrogen generation facility will generate 200,000Nm³/h of hydrogen and steam to produce sulfur-free fuels. The other processing units at the refinery include the STRATCO alkylation unit, the MECS sulphuric acid regeneration (SAR) unit, the MECS DynaWave sulfur recovery unit, and the BELCO EDV fluid catalytic cracking unit.
To make access easy in the Dangote Refinery, there are facilities such as a pipeline system, access roads, tank storage facilities, and crude and product-handling facilities. There is also a marine terminal including a breakwater, jetty, and harbor that has also been developed as part of the project. Including an administrative building, guardhouses, fire stations, and pump stations. Dangote fertilizer plant, which is a part of the refinery will utilize the refinery by-products as raw materials. Dangote had to build some resources such as an industrial gas plant, which welds everything together. Trucks, which is producing in partnership with a Chinese company and a power plant that produces 480 megawatts of power for the refinery.
One would wonder where the funds for such a huge project are coming from, well here it is. Standard Chartered Bank and some local and international banks agreed to provide a $3.3bn syndicated loan facility for the project. Also, the United States Trade and Development Agency provided an N251.3bn ($0.997m) training grant for the Human Resource Development for the refinery operation. Dangote has personally sunk his own $6 billion into the refinery project. The facility’s engineering, procurement, and construction were handled by Engineers India Limited, who are specialists in building refineries. Honeywell UOP supplied catalyst regeneration and dryer regeneration control systems, column trays, heat exchanger tubes, a modular CCR unit, and catalyst coolers among others.
Dangote Refinery besides the oil production, will also pump out plastic products to serve the throng of consumers in Nigeria, and produce enough fertilizer to serve the farmers’ needs. It is expected that the mechanical commissioning of the Petrochemical and Refinery plant would kick off by the end of the first quarter of 2022.
THE NIGERIAN DREAM
Dangote’s biggest dream is for Nigeria to make history as the largest exporter of petroleum products and exporter of fertilizer in Africa. And he is one step closer to that dream as his fertilizer plant commenced commercial sales of Urea recently. The Urea was produced for local consumption and export as well. This move has been described as one that would liberalize the fertilizer market, enhance the agricultural industry and also earn the much-needed scarce foreign exchange for Nigeria. This plant, which actively churns out 3 million metric tonnes of urea annually is the biggest fertilizer project in the world.
According to Dangote, the first phase of the project costs about $2.5 billion, and its capacity will be further enhanced to produce different grades of fertilizers, which will meet soil, crop, and climate-specific requirements for the African continent.
“So, our Urea will be in the market from Monday, and by God’s grace before the end of this month, we will start bringing in Dollars from the first line that we have commissioned”. He added that the Urea is a small percentage utilization of gas that the country is flaring, which means there is potential for more. Dangote besides flooding the market with Urea, would also train farmers on how best to apply Urea to their farms, and thus ensure food security for the nation.
Dangote believes that Nigeria needs to focus on value-added petroleum products, instead of crude oil alone, for him that is his Nigerian dream, to make the country stand tall in the comity of nations.
The 61-year-old Dangote may finally take a rest after the refinery project is finally done and dusted. He hopes to pull back from the business, I mean he has seemingly been there and done that anyway. His next project is to indulge himself by buying Arsenal’s Football team. This has been a long-life dream for him as he has been a fan of the football club for ages. He will again make history as the first black man to own a British football club.
Arsenal is reported $2 billion, and Dangote pledges to get involved in the rebuilding of the club when he buys it.
CHALLENGES
Aliko Dangote has faced various challenges in his business quests, but with a steel-set mindset has to be able to overcome them through innovative thinking and remaining undaunted in his quest to build a business empire, make a positive impact on humanity and leave a legacy as one of those who made Africa great. Dangote is one man who is not afraid to dream big, yes, he is not.
He is called many names, a tough guy, a hero who builds factories, employs thousands, and reinvests his money at home, a villain, a ruthless monopolist who squeezes favors from the government of the day and crushes competition like limestone in a cement mixer. Some accuse him of tax evasion through bogus investment incentives, more of a rentier than an entrepreneur, gouging the country with high prices and raking in ludicrous profits. “People throw a lot of mud at you and you have to see how you can clean it up,” Dangote said.
His refinery aims to produce all refined petroleum products that Nigeria needs, thereby saving the country billions of dollars in foreign exchange. His drive to success has also brought about peculiar challenges to him. The Nigerian business terrain is for the tough and the tough alone. He had a conflict with the Tanzanian president, who threatened to seize his assets. He has also lost good staff either in crisis-ridden areas or otherwise. What’s more, he barely ever rests. He is often crisscrossing across the world on his private jet. These activities have health implications for the billionaire as well. No wonder he is thinking of slowing down.
PERSONAL LIFE
Dangote cuts a picture of humility, living a very reclusive lifestyle and not one to flaunt his assets, which includes a $43m yacht, Mariya, named after his mother. The 108-foot vessel is a few feet shorter than the yacht of fellow billionaire Femi Otedola, whose model of yacht Mariya was built after.
He has friends in high places, has a robust social life, remembers the names of everyone he comes in contact with, and has the number of everyone he needs. He is indeed a colossus, one man that Nigeria, Africa, and the world will never forget.
His money is what we call ‘clean money in Nigerian parlance. He makes no secret of how he got his big break. It was during the time of 1999 of Olusegun Obasanjo, just after the 1999 general elections. Dangote contributed both to that campaign and his subsequent re-election in 2003. Obasanjo wanted Nigeria to start producing cement instead of importing, Dangote advised him to restrict cement importation, Obasanjo did just that, and Dangote has never looked back since then; he has turned that singular opportunity into a conglomerate. It is noteworthy to mention that Dangote’s cement’s price is very competitive with prices across West Africa.
EMPLOYMENT OPPORTUNITY
The integrated refinery and petrochemical projects are expected to generate 9,500 direct and 25,000 indirect jobs in Nigeria and this will go a long way to ease the unemployment challenges in the country.
