$23bn refinery biggest risk of my life – Dangote

• Published On: 19 February 2025 at 06:28

Aliko Dangote, the Chairman of the Dangote Group, has stated that the massive risk he took with the Dangote Refinery, a venture that has redefined his wealth and transformed Africa's energy sector, was the biggest risk of his life.

The 67-year-old billionaire revealed that the refinery's final investment exceeded $20 billion, more than doubling its initial budget.

In an exclusive interview with Forbes, Aliko Dangote revealed the obstacles to the massive project.

Originally estimated at $10 billion, the refinery's cost skyrocketed as Dangote pushed for an expanded scope, insisting on taking the project much larger than originally planned.

"If this didn't work, I was dead," he told Forbes, recognising the magnitude of the risk he took when he first announced the refinery in 2013.

Dangote had planned to build the refinery in southwest Nigeria, but delays caused by disagreements with local officials hampered progress.

In response, he made a strategic shift, moving the project to the Lekki Free Zone near Lagos and paying $100 million for the land.

However, the relocation presented its own set of challenges, as the swampy land necessitated dredging 65 million cubic meters of sand and constructing a port to facilitate transportation.

The refinery's financing plan was equally ambitious. To fund the project, Dangote obtained $5.5 billion in bank loans and sold stakes in his cement company, raising $600 million from investors including Dubai's investment corporation and an Australian sovereign wealth fund.

Despite the challenges, the Dangote Refinery will begin operations in 2024. It began operations on a 6,200-acre site with a capacity of 350,000 barrels of crude per day, increasing to 500,000 barrels per day by January.

The refinery, which is set to reach full capacity next month, will process an impressive 650,000 barrels per day, making it the world's seventh-largest refinery and Africa's largest.