Aliko Dangote, founder and CEO of the Dangote Group, has long held the title of Africa’s richest man. However, in 2024, his ranking became unstable due to the sharp devaluation of the naira, which significantly reduced his net worth in dollar terms. Despite this, 2024 marked a significant milestone for the Nigerian industrialist as the Dangote Refinery began operations. This development came 11 years after he announced his intention to build the refinery and eight years after construction commenced at the Lekki Free Trade Zone in Lagos. Valued at $20 billion, the refinery boasts the capacity to process 650,000 barrels of crude oil daily—enough to meet Nigeria’s entire petrol demand, with surplus available for export.
The refinery’s launch into petrol production was met with intense controversy, given the nation’s unstable fuel supply and rising petrol prices. The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) claimed the refinery lacked proper licensing, accused it of attempting to monopolize the market, and criticized its petrol quality as inferior to imported fuel. In response, Dangote made explosive allegations before the House of Representatives, accusing officials from the national oil company, NNPC Limited, and certain fuel traders of operating petroleum blending facilities in Malta. This came while NNPCL struggled to revive even one of its four non-functional local refineries. Reports also surfaced suggesting that international oil companies (IOCs) in Nigeria were undermining the Dangote Refinery’s efforts.
While many Nigerians rallied in support of the indigenous refinery, skepticism remained over Dangote’s business strategies. Public sentiment soured further when Dangote, in an interview with Bloomberg TV, claimed that petrol prices in Nigeria were 40% lower than in Saudi Arabia and advocated for the removal of petrol subsidies, despite the inflationary effects of rising fuel costs since May 2023.
As feared by many, the refinery’s petrol supply failed to reduce fuel prices domestically. In fact, the Independent Petroleum Marketers Association of Nigeria (IPMAN) reported that Dangote’s petrol was more expensive than other sources. This surprising development led NNPCL and other oil marketers to continue importing large volumes of petrol and diesel in the last quarter of the year, contributing to increased demand for dollars, even though the Dangote Refinery had available supplies.