Aliko Dangote, the richest black person in the world recently revealed the biggest risk he has ever taken, and it’s hardly a surprise that it is a project that cost over $20 billion.
The founder of the Dangote Group, noted on Monday, during an interview that building and running the operations of his oil refinery has been faced with its own unique set of challenges.
He noted that the Dangote refinery, one of the largest private-sector investments in Africa’s history, which cost a little over $20 billion is his biggest gamble ever.
“It was the biggest risk of my life. If this didn’t work, I was dead,” Dangote said in an exclusive interview with Forbes.
Dangote and the NNPC
Last year, the Dangote Refinery officially commenced operations after 11 years and $23 billion in investment.
The refinery, which is situated on a huge 6,200-acre complex in Nigeria’s Lekki Free Zone, and processes roughly 500,000 barrels of oil per day (b/d), currently, since its launch been faced with its own unique set of challenges.
For example, it faced an episode where the Nigerian National Petroleum Corporation (NNPC), which at first refused to sell crude in its local currency, thereby inflating the price of the product.
Additionally, the NNPC had initially consented to pay $1 billion upfront to acquire a 20% stake in the refinery, but later reduced its proposal to around 7% and wanted a portion of its investment back.
In addition, the NNPC promised to provide Dangote with 300,000 barrels of crude oil per day, but it hasn’t done so. As per the Forbes interview, the NNPC is yet to respond to a request for comment.
Citing a 2021 legislation that calls for local crude producers to provide enough oil to local refineries to fulfill domestic demand, Dangote filed a lawsuit against the NNPC in September in a bid to stop it from importing and selling refined gasoline products. (That lawsuit is still pending).
The NNPC began supplying oil to Dangote’s refinery in October, but it hinted last month that it would cut back on its supply. Dangote is unreserved in his condemnation of the group, accusing it of being a part of his nation’s “oil mafia.”
“The oil mafia is more deadly than the one in drugs because, with the oil mafia, there are so many people that are involved,” says Dangote.
“You might be wining and dining with them, but these are the guys that are the masters of moving things around.”
Dangote is committed to the refinery’s success despite these obstacles.
“I’ve been fighting battles all my life,” Dangote says, “and I have not lost one yet.”
Although he has established a family office in Dubai and his three daughters serve in a variety of roles for the family business, he still places a greater emphasis on Nigeria than on succession planning. According to the millionaire, he still meets with managers and engineers at his refinery a lot.
The Dangote Refinery is the largest refinery in Africa and the sixth largest in the world by production when it reaches its full capacity, which is anticipated to be 650,000 barrels per day next month.
