Page 5 - DMEA Week 35 2021

DMEA COMMENTARY DMEA

announcement of a disproportionate number of Mechanical completion of the refinery is
refining projects that have little chance of ever anticipated late this year, with operations pegged
being realised. You would get pretty long odds on to begin in January 2022, though Edwin said
more than half of these units being completed,” only that the petrochemical unit was nearing
he added. completion.
The unit will have a capacity of 900,000
Refinery deal tonnes per year (tpy) and is expected to generate
Also this week, Aliko Dangote said that the an annual turnover of $1.2bn.
National Nigerian Petroleum Corp. (NNPC) He was quoted by the News Agency of Nige-
would pay only around a third of its acquisition ria as saying: “It has been strategically positioned
of a 20% stake in the Dangote Refinery in cash. to cater for the demands of the growing plastic
Speaking to the Arise News channel, he said processing downstream industries; not only in
that the remainder would be split between crude Africa, but also in other parts of the world.”
sales and profits. “Right now, raw materials from polypropyl-
Noting that he wanted to clarify misconcep- ene are imported into the country. There is no
tions about the refinery deal, he said: “When foreign exchange for manufacturers to import
they talk about the $2.7bn, you know, [NNPC] raw materials. The Dangote Petrochemical plant
are paying one third of the money. Another one is going to take care of this challenge – when the
third of the money, again, will actually be paid raw materials are locally available, there will be
through supply of crude, with the deduction of many more people who will be willing to invest
[a] maximum of about $2 and some cents. And in the economy,” he added.
then the [final] one third of it, which is another He added that the country would benefit
$850mn to $900mn, will be paid from the profit from the foreign exchange savings from reduc-
they are going to make from the business.” ing petrochemical imports with the downstream
He added: “It’s not a cash transaction where sector to receive a significant boost from “the
they are paying all cash. You can see that if we availability of petrochemicals in the country”.
don’t have confidence in what we are doing, we In June, Dangote began commercial produc-
would have asked them to pay all cash.” tion of urea at facilities located near the inte-
Dangote also noted that the deal would see grated refinery and petrochemicals complex.
NNPC also take a stake in the petrochemicals The urea plant, which will have a capacity of 3mn
project. tpy in its first phase, is claimed by Dangote to be
the largest project in the global fertiliser sector.
Petchem progress The Dangote Fertiliser complex consists of
Meanwhile, the refinery’s parent firm Dangote two 2,200-tonne per day ammonia plants using
Industries has provided an update on the devel- Halder Topsoe technology, two 4,000 tpd melt
opment of the petrochemical facility the com- urea plants using Snamprogetti technology and
pany is building to sit alongside the world-scale two 4,000 tpd urea granulation plants using
refinery. Uhde Technology.
In a statement to press, Devakumar Edwin, While there remains significant doubt about
Dangote’s executive director of strategy, capital the addition of millions of barrels of refining
projects and portfolio development said that the capacity, projects that have advanced to the
$2bn petrochemical facility’s slate will comprise construction phase will transform the country’s
77 different grades of polypropylene, with the downstream sector, creating jobs, aiding man-
unit becoming the largest of its kind in Africa. ufacturing and reducing Abuja’s import bill.™

Week 35 02•September•2021 www. NEWSBASE .com P5