Africa’s richest man and President/CEO of Dangote Industries Limited, Aliko Dangote, has raised alarm over the continent’s continued reliance on imported petroleum products, calling it an unsustainable economic model that undermines local development. Speaking at the West African Refined Fuel Conference in Abuja, Dangote revealed that his refinery currently imports 9–10 million barrels of crude oil monthly from the US and other countries due to difficulties accessing Nigerian crude at competitive terms.
Aliko Dangote, while delivering the keynote address at the West African Refined Fuel Conference organized by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and S&P Global Commodity Insights, warned that Africa is losing an estimated $90 billion annually to the importation of refined petroleum products.
He stated that although Africa produces large quantities of crude oil, it still imports over 120 million tonnes of refined petroleum products every year. “So, while we produce plenty of crude, we still import over 120 million tonnes of refined petroleum products each year, effectively exporting jobs and importing poverty into our continent. That’s a $90 billion market opportunity being captured by regions with surplus refining capacity,” Dangote stressed.
He added that only about 15% of African countries have a GDP greater than $90 billion, emphasizing that the continent is “effectively handing over an entire continent’s economic potential to others, year after year.”
Dangote also criticised the quality of imported fuels entering the African market, describing many as substandard, often toxic products that would not be permitted in Europe or North America. “It defies logic and economic sense for Africa to be exporting raw crude only to re-import refined products, products we are more than capable of producing ourselves, closer to both source and consumption,” he said.
Reflecting on the journey to complete the Dangote Petroleum Refinery, the industrialist revealed the enormous scope of the project. The refinery sits on 2,735 hectares of land,seven times the size of Victoria Island,with 70% of it initially swampy. Stabilizing the site required 65 million cubic meters of sand, over 250,000 foundation piles, millions of metres of piping and cabling, and the coordination of more than 67,000 workers, 50,000 of whom were Nigerians.
COVID-19 setbacks delayed the project by two years, adding new levels of complexity and risk. Despite the hurdles, Dangote noted, “We didn’t just build a refinery, we built an entire industrial ecosystem from scratch.” He explained that the refinery’s size and logistical needs demanded a dedicated seaport, over 2,500 pieces of heavy equipment, 330 cranes, and even the construction of the world’s largest granite quarry with a 10 million tonne annual capacity.
Yet, Dangote highlighted that commercial and regulatory challenges have persisted. Since the project’s inception, Nigeria’s exchange rate has moved from N156/$ to N1,600/$, making project financing and import costs unpredictable. He revealed that although Nigeria produces about 2 million barrels of crude daily, the refinery struggles to obtain crude at fair market terms.
“Rather than buying crude oil directly from Nigerian producers at competitive terms, we found ourselves having to negotiate with international trading companies, who were buying Nigerian crude and reselling it to us, with hefty premiums, of course,” Dangote revealed. He confirmed that the refinery now imports between 9 to 10 million barrels of crude oil monthly from the US and other nations.
Dangote did, however, commend the Nigerian National Petroleum Company Limited (NNPC) for supplying some Nigerian crude since the refinery began operations.
On logistics, Dangote noted that port and regulatory charges in Nigeria account for 40% of total freight costs, sometimes nearly equaling the cost of hiring vessels. He said, “Refiners in India, who purchase crude oil from regions even farther away, enjoy lower freight costs than we do right here in West Africa because they are not saddled with exorbitant port charges.”
He further lamented that domestic customers pay port charges both at the point of loading and discharge, unlike those loading from Lome, where only one charge is required. According to him, such inefficiencies make local refining less competitive and encourage imports.
Another concern he raised was the absence of harmonized fuel standards across Africa. “The fuel we produce for Nigeria cannot be sold in Cameroon or Ghana or Togo, even though we all drive the same vehicles. This lack of harmonization benefits no one, except, of course, international traders, who thrive on arbitrage,” Dangote explained.
He also drew attention to a troubling trend: the dumping of low-quality, discounted fuel, particularly from Russia, into African markets, a development he said is damaging local refining initiatives. Dangote urged African governments to take a cue from countries like the US, Canada, and members of the European Union, who have introduced protective measures to safeguard their domestic refining industries.
