Dangote: Why Refineries Will Not  Work After Gulping $18bn

Africa’s Richest Man and President of the Dangote Group, Aliko Dangote, says the three refineries in Port Harcourt, Warri and kaduna may never work again despite gulping over $18 billion in turn around maintenance.

Dangote is the owner of the $20 billion Petroleum refinery in Lagos, which has the capacity to refine 650,000 barrel of crude oil per day.

He recently said the refinery will soon be the only buyer of Nigeria’s crude oil as the company ramp up its capacity to provide energy security for the country.

The business mogul who spoke on Thursday while hosting members of the Global CEO Africa from the Lagos Business School, on a tour of the Dangote Petroleum Refinery in Lekki, Lagos, lamenting his frustration after some federal government officials stopped his acquisition of the refineries over 18 years ago.

Recall that the former President Olusegun Obasanjo administration had sold the refineries to the business man, but his successor, Umaru Yar’adua reversed the deal.

He said the reason why President Yar’adua reversed the sale was because some people in his administration convinced him that the refineries will work again.

The said officials, he claimed also told late President Yaradua that the refineries were sold to him by former President Obasanjo too cheaply, as a parting gift to the businessman.

The refineries have been struggling to produce since then, Dangote said.

Dangote described the refineries as a 40 years old car, noting that no turn-around-maintenance will make them bounce back to life because they are old and outdated.

Dangote: “The refineries that we bought before, which were owned by Nigeria, were doing about 22 per cent of PMS. We bought the refineries in January 2007. Then we had to return them to the government because there was a change of government.

“And the managing director at that time convinced Yar’adua that the refineries would work. They said they just gave them to us as a parting gift or so. And as of today, they have spent about $18bn on those refineries, and they are still not working. And I don’t think, and I doubt very much if they will work.

“(The turnaround maintenance) is like you trying to modernise a car that was built 40 years ago, when technology and everything have changed. Even if you change the engine, the body will not be able to take the shock of that new technology engine.”