Dangote Refinery Complex: A new dawn for Nigeria’s economy

By Sunny Chuba Nwachukwu

The Dangote refinery, petrochemicals and fertilizer complex is one in a million giant stride in the development of the right infrastructural local refining facilities in Nigeria’s oil industry. This gigantic, visionary, economically viable and value addition pathfinder in the system will drastically turn things around very quickly through the economic activities it will generate. Transportation, which involves movement of goods and services, movement of travellers (commuters) chasing and going about their businesses from point A to point B; through land, air and waterways. Manufacturing sector, consuming energy generated by privately installed turbines, to drive machinery for production processes. These include heavy duty machinery used for construction and processing of building materials at quarries. In other sectors like agriculture, agricultural equipment for mechanized farming in agribusiness are powered too. All these need either gasoline/PMS, aviation fuel, kerosene or AGO/diesel; to drive their respective engines.

All these economic activities going on within the economy pointedly and significantly indicate that the downstream, fully developed and equipped with local refineries in an oil producing nation like Nigeria, is critically very strategic towards driving an economy effectively and efficiently! It’s on this note that the Dangote Group deserves to be celebrated for their visionary and generational achievement and the visible exploit made.

The first batch of urea fertilizer hitting the market in the first week of March 2021 was full proof of the project’s reality, which also indicates very clearly that the nation will be the economic hub to beat in the entire African continent, especially with the new continental multilateral free trade, AfCFTA.

International trade outside the continent of Africa, with the newly created AfCFTA, is bound to change its equation by no longer making Africa a ‘dumping ground’ for all manner of finished goods and services but, a business hub that will be attractive for productive investments, where all forms of raw materials naturally sourced, her harvested agricultural produce and mined minerals (both solid and liquid), are further transformed into finished goods/products by value addition. It is believed very strongly that this perceived process of ‘backward integration’ within the continent shall be speedily facilitated by the existence of AfCFTA. It is,therefore, equally hoped that this course shall be aggressively pursued and corporately driven to a logical conclusion, through the influences of the transformative cause of the newly led World Trade Organization (WTO) under Dr. Ngozi Okonjo Iweala (the DG of WTO); and the various schemes and packages already being initiated by the AFREXIM Bank in Cairo, Egypt, ably headed by Professor Benedict Okey Oramah, its president.

From the refinery’s 650,000 barrels of crude oil daily offtake, its  calculated daily output capacity of 57 million litres of PMS (as estimated with 53% maximal yield of Gasoline/PMS conversion efficiency), Nigeria’s 33 million litres of PMS domestic daily demand is already conveniently and comfortably solved, and contained internally within the economy. This feat, Dangote Refinery has achieved! The Dangote Group, indeed, deserves a huge and thunderous applause.

By the first quarter of 2022, when it will be fully on stream, visible turn around to the nation’s economic profile will manifest, and be drastically different from what it is presently. Instead of wasting further foreign exchange weekly for petroleum products imports, at least 41 per cent of it shall be saved (according to the CBN Governor, Godwin Emefiele). Yet, the daily local demand will be conveniently met and serviced from within, with this singular noble achievement by the Dangote Group. The demography of the nation’s economic history, where upstream operations alone used to be the major generator of the export earnings through sales of our “cash-cow”, the crude oil is about to change. This time, the excess of all locally refined products, after meeting the daily domestic demands of PMS (33 million litres), Kerosene (9 million litres) and Diesel/AGO (10 million litres), shall earn more FX through exports of refined products (possibly to our close neighbours in the sub-regional West Coast).

This development will not just improve our export earnings but shall extensively boost the activities that promote non-oil exports for general economic growth. The primary assignments being pursued through promotional engagements, packages and programmes of the Nigerian Export Promotion Council (NEPC), will surely receive a boost through this improved business environment, that shall ease off the high cost of transporting raw materials for productions of the exportable non-oil goods from Nigeria (at least).

On the cost of products pump price at our various filling stations, the era of scarcity, incessant fuel price hike and other forms of embarrassing and shameful developments being encountered by the general public within an economy that massively produces and exports crude oil, shall be a thing of the past.

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Nwachukwu, a graduate of pure and applied chemistry with an MBA in management, is an Onitsha based industrialist, a fellow of ICCON, and vice president, finance, Onitsha Chamber of Commerce.

Sunny Chuba Nwachukwu (FICCON, LS)

Onitsha, +2348033182105