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NNPC’s Stake in Dangote Refinery Reduced to 7.2%-Says Dangote
...NNPC Ltd Confirms; Says: It assessed its investment portfolio in sync with its goals
The founder, chairman, and CEO of the Dangote Group, the largest industrial conglomerate in West Africa, and Africa’s richest man, Alhaji Aliko Dangote, has sensationally declared that the Nigerian National Petroleum Company Limited, NNPCL, now owns a 7.2% stake in the Dangote Petroleum Refinery.
This is in contradistinction to a 20% stake initially announced prior to the inauguration of the facility at the Lekki Free Trade Zone in Lagos.
Dangote disclosed this while addressing a cocktail of issues at a press conference in Lagos on Sunday.
According to him, the NNPC Limited’s stake dropped to 7.2% consequent upon its failure to pay the balance of their share, which fell due in June. The NNPCL had acquired a 20 per cent interest in the $20bn Dangote refinery for $2.76 billion.
But on Sunday, Dangote declared: “NNPC no longer owns a 20 per cent stake in the Dangote refinery. They were met to pay their balance in June, but have yet to fulfil the obligations. Now, they only own a 7.2% stake in the refinery.”
The NNPCL, also on Sunday, corroborated the billionaire businessman’s claim in a statement issued by its spokesperson, Olufemi Soneye, saying: “NNPC Limited periodically assesses its investment portfolio to ensure alignment with the company’s strategic goals.
“The decision to cap its equity participation at the paid-up sum was made and communicated to Dangote Refinery several months ago.”
The Crest recalls that Nigerians were elated when Alhaji Dangote, one of Africa’s leading industrialists, announced commencement of operations at his $20billion sprawling refinery in Lekki, Lagos with 350,000 barrels a day. When it attains full capacity production by the end of the year, the facility will be producing 650,000 barrels per day. Already, the refinery has begun the supply of diesel and aviation fuel to marketers in the country while petrol supply is expected to commence in August.
But the journey has not been all smooth since the refinery began operations. At a point, Dangote had to cry out that he could not get Nigerian crude to feed his facility. Indeed, a Bloomberg report disclosed that Dangote Refinery bought about 24 million barrels of crude from the United States.
The NNPC had reportedly pledged Nigerian crude in a $3.3 billion oil-for-loan Afreximbank deal which reportedly hampered its local crude supply. Nigeria’s crude oil production rose to 1.276 million barrels per day (bpd) in June, far lesser than the 1.7 million bpd benchmark in the 2024 Budget.
Reacting to the situation, the Minister of State for Petroleum Resources (Oil), Mr. Heineken Lokpobiri, had, in May, explained that the decision by Dangote Refinery to import US crude might be based on its business model.
However, at his media briefing on Sunday, Alhaji Dangote announced that his organization had resolved the knotty crude oil supply issue with the NNPCL and the Federal Government, assuring that his refinery would begin to supply refined products (petrol) from next month, August 2024.
