President/CEO of Dangote Industries Limited, Aliko Dangote, has disclosed that the Dangote Petroleum Refinery imports around 9–10 million barrels of crude oil every month from the United States and other countries, due to difficulties in securing competitively priced crude from local suppliers.
Dangote made the revelation during his keynote address at the West African Refined Fuel Conference in Abuja, organised by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and S&P Global Commodity Insights.
He criticised the current crude oil trading system, noting that the refinery is often forced to buy Nigerian crude from international traders who re-sell it at inflated prices.
Africa’s $90 Billion Refining Paradox
Dangote lamented Africa’s overreliance on fuel imports, describing it as a “massive economic leakage.”
“Africa imports more than 120 million tonnes of refined petroleum products every year, at an annual cost of about $90 billion,” he said.
“This is equivalent to the GDP of most African countries and amounts to exporting jobs and importing poverty.”
He warned that the continent is becoming a dumping ground for cheap and often substandard fuel, some of which would be illegal in Western markets.
“While we produce plenty of crude, we are still dependent on refined imports. It makes no economic sense to export raw crude and re-import finished products we can refine locally,” Dangote stressed.
Building Africa’s Largest Refinery
Reflecting on the challenges of constructing the world’s largest single-train refinery, Dangote described it as an unprecedented industrial effort.
“We had to clear 2,735 hectares of land—70% of it swamp.
Over 65 million cubic metres of sand were pumped in to raise the site by 1.5 metres,” he said.
The project required:
- Over 250,000 foundation piles
- Millions of metres of piping, cables, and wiring
- 2,500 pieces of heavy equipment
- Construction of a dedicated seaport
- Establishment of Africa’s largest granite quarry (10 million tonnes/year)
At its peak, the site employed over 67,000 workers, including 50,000 Nigerians.
“We didn’t just build a refinery—we built an entire industrial ecosystem,” he stated.
Commercial and Regulatory Hurdles
Despite technical success, Dangote outlined serious commercial and regulatory issues threatening the refinery’s long-term viability.
“When we began, the naira-dollar rate was ₦156/$. Today, it’s over ₦1,600/$. That kind of volatility affects everything—especially a project this large,” he said.
On crude supply, he noted:
“We expected to get Nigerian crude directly. Instead, we’re buying from international middlemen who sell it back to us with huge premiums.
That’s why we now import 9 to 10 million barrels a month from the US and elsewhere.”
He, however, acknowledged efforts by the NNPC, which has supplied some Nigerian crude to the refinery since operations began.
Logistics and Cost Inefficiencies
Dangote said excessive port charges are a major drain on refiners in Nigeria. According to him, port and regulatory fees make up 40% of total freight costs, sometimes even twice the cost of chartering a vessel.
“Indian refiners, importing crude from farther distances, pay less freight than we do here in West Africa,” he said.
Even worse, it is more expensive to load petroleum products from Dangote Refinery than from Lomé, Togo, where charges are paid only at the discharge point.
Call for Regional Standards and Protection
Dangote also raised concerns about the lack of harmonised fuel standards across African countries, which blocks intra-African trade in refined products.
“Fuel produced for Nigeria can’t be sold in Ghana, Cameroon, or Togo—even though we all drive the same cars,” he said.
“This only benefits foreign traders who exploit the differences through price arbitrage.”
He warned of the increasing flow of heavily discounted, low-quality Russian fuel into African markets, urging governments to introduce protective policies similar to those in the US, Canada, and the EU, to shield domestic refiners from unfair competition.
Conclusion
Aliko Dangote’s address painted a sobering picture of Africa’s refining landscape—rich in crude oil but heavily dependent on fuel imports. He called for urgent reforms, including regional policy alignment, investment in local refining, and elimination of unfair trade practices, to ensure that Africa finally benefits from its own natural resources.
