Africa’s richest billionaire, Aliko Dangote plans to borrow $3.3 billion to invest in Nigeria’s first private oil refinery. The $9 billion oil refinery and petrochemical complex is expected to decrease Nigeria’s dependence on oil imports and boost Dangote’s fortune significantly, according to a report in Forbes.com.
A consortium of local and foreign banks will finance the project with the Dangote Group officially scheduled to sign the agreement Sept. 4, according to Nigeria’s Business Day.
Nigeria’s first private oil refinery will be located at the Olokola Liquefied Natural Gas Free Trade Zone in Nigeria’s southwest, and will be Africa’s largest oil refinery. It will have a projected daily output of 400,000 barrels and be in operation by 2016, the report said.
The Nigerian government owns refineries in Port Harcourt, Warri and Kaduna that are capable of refining 415,000 barrels per day, but they operate at less than 30 percent of capacity. Nigeria, one of Africa’s top oil producers, relies heavily on foreign refineries.
In May, Dangote raised $4.5 billion from a consortium of Nigerian banks for this project. The Dangote Group is committing $3.5 billion of its own to the project and seeks an additional $2.25 billion from development funds. The total cost is expected to be between $9 and $10 billion, ranking among the largest contributions by a private sector group to Nigeria’s economy.
Dangote’s personal fortune is said to be more than $19 billion, according to Forbes.com. Most of it lies in shares of publicly traded Dangote Cement.