Dangote Industries Limited has signed a loan agreement with a consortium of both local and international banks to the tune of $3.3billion for the purpose of constructing the biggest petroleum oil refinery and petrochemical/ fertiliser plants in Nigeria.
The plants, which would cost a total of $9 billion, would generate up to 9,500 direct and 25,000 indirect jobs, in addition to reducing current volumes of refined fuel imports by around 50 per cent and effectively stop the importation of fertiliser.
The $9billion project would be financed by $3billion equity and $6billiion loan capital. Yesterday's signing ceremony commits the first tranche of loans secured by Dangote, comprising a $3.3billion term loan facility supported by a consortium of 12 local and international banks. This first facility was jointly coordinated by Standard Chartered Bank as the Global Coordinator, and Nigeria's Guaranty Trust Bank Plc as the local coordinator.
With the refining capacity expected to reach 400,000 barrels of crude oil per day and producing a variety of refined fuel products from local crude resources, Nigeria would cut its current volumes of imported fuel products by a massive 50 per cent. The 2.8 million tonnes of urea would be channelled into growing the local agriculture sector which is essential in producing healthy crops and promoting Nigeria and West Africa's agricultural development. The petrochemical plant would produce polypropylene which is a common component of most plastic and fabric products.For example, it is used in various forms of packaging, ropes and agro-sacks.
President of Dangote Group, Aliko Dangote said: "This plant will further entrench Africa's role on the global map as not only a valued contributor for natural resources, but also a competent manufacturer of refined products and fertiliser. As a result, several African nations will be less reliant on importing fuel and fertiliser from foreign markets, reducing the negative impact of negotiating terms within increasingly turbulent international markets."
Meanwhile, Dangote has said Nigeria's current fuel importation will end by 2016 with the coming on stream of the proposed the Dangote Petrochemical project.
This is even as President Goodluck Jonathan said his administration will not relent with the implemention of policies and measures that will help improve the operating environment for entrepreneurs and investors in the Nigerian economy.
Dangote spoke yesterday when he visitedPresident at the Aso Rock after the signing of the loan agreements for the complex. He was accompanied by Chief Executives of participating banks including First Bank of Nigeria, UBA, Stanbic-IBTC, Zenith Bank, Access Bank, Ecobank, Fidelity Bank, Guaranty Trust Bank and Rand Merchant Bank.