City Business : The New Dangote Refinery

Nigeria on the brink of collapse given the operational inefficiencies in the nations oil and gas industry. The persistent fuel crisis is a calamity waiting to consume the country , for how long will the state continue to import refined fuel given its status as the ninth largest producer of crude oil in the world. In my submission , the government of the day has continued to treat this sensitive issue with kid gloves which should be given a serious attention . The announcement by business mogul in the person of Alhaji Aliko Dangote to establish a new refinery has brought mixed reactions in the country, with some quarters thinking the industry will be monopolized to favor Alhaji Aliko Dangote , while some believe aggressive development will be achieved under his watch.  

 

This new refinery to be built by business mogul, Alhaji Aliko Dangote, the 400,000-barrels-a day capacity refinery will come on stream in late 2016. Dangote, who disclosed this to Reuters said it was a matter of time, the infrastructure we now have would no longer be to able to receive the amount of fuel the country imports.
The refinery, when operational, will be a big relief in a country that is a major producer of crude oil, but still imports about 80 percent of its domestic fuel needs. It is also a relief in that when operational, Dangote would have succeeded in the petroleum downstream sector where many companies that had got licenses to establish refineries have failed years after.
Nigeria presently has four refineries with a combined capacity of about 450,000 barrels per day. Unfortunately, they are all operating at far below capacity, due to decades of mismanagement and corruption which successive governments have not been able to address. Rather, they have chosen the option of importation to augment local supplies, to the detriment of the country’s economy.
With fuel subsidy running into the trillion naira mark, importation of the commodity and subsequent subsidy payments on it have become an industry menace from which some people are feeding fat and are therefore unwilling to let go of the subsidy regime that has sustained them for decades.
In my submission , I think the entry of Alhaji Aliko Dangote into downstream sector of the oil and gas industry will bring good fortunes to the country and subsequently other new refineries will come on stream to increase the country’s refining capacity