Dangote exposes 'mafia' that tried to block $20bn refinery
Africa's richest man, Aliko Dangote, revealed how entrenched interests benefiting from Nigeria's fuel import and subsidy regime tried to frustrate construction of his $20 billion refinery, describing them as a powerful 'mafia' determined to preserve the lucrative subsidy system. The resistance came from traders, shippers and local beneficiaries who saw the refinery as a threat to billions in profits.
Securing land to build the world-class refinery took five years, with one site delayed for 3.5 years and another for 1.5 years as vested interests sought to stop the project. For decades, Nigeria spent huge sums importing refined petroleum products despite being a major crude producer, with subsidy payments alone reaching nearly $10 billion annually that enriched a few players at the expense of the wider economy.
The refinery employed 67,000 people during construction and is now changing Nigeria's market structure. Currently sourcing 56% of crude locally from Nigeria while also importing from Angola, Libya and the US. Dangote plans to expand capacity to 1.4 million barrels per day in the next 30 months, significantly reducing Nigeria's dependence on imports and subsidy payments. What does this mean for petrol prices and Nigeria's economic future?