Dangote revealed fierce resistance from the ‘oil mafia’ during the battle to build a $20 billion refinery

Dangote Group President and Africa’s richest man, Aliko Dangote, has revealed that powerful interests in Nigeria’s oil sector are allegedly fighting aggressively to stop the construction of the $20 billion Dangote Oil Refinery, fearing the project will disrupt the country’s long-standing fuel import business.

Dangote said the refinery had faced resistance for years from incumbents in the oil industry who profited from Nigeria’s dependence on imported refined products despite Nigeria being one of Africa’s largest crude oil producers.

According to him, the determination to end Nigeria’s dependence on imported fuel and the endless fuel queues experienced by citizens is the driving force behind the ambitious project.

Speaking in an interview with the Chief Executive Officer of Norway’s sovereign wealth fund, Nicolai Tangen, Dangote reflected on the major obstacles faced from the early stages of the refinery’s development.

“We are looking at oil. Africa produces oil, but many countries do not process it. They export crude oil and import refined products, which depletes foreign exchange reserves,” he said.

“In Nigeria, we have had fuel queues for over 50 years. People queue for days during Christmas just to buy petrol in an oil-producing country. The government-owned refineries weren’t working well, so I decided to take a bold step by building a refinery.”

Dangote revealed that the project, which officially started in 2013, experienced repeated delays, including prolonged land acquisition problems that lasted several years.

“We launched this project in 2013. Land acquisition alone delayed us for five years. Some of these obstacles were caused by entrenched interests in the oil business – what you might call the mafia – who tried to stop us from solving this problem. But we remained focused.”

The billionaire businessman said the refinery project had become more challenging due to Nigeria’s deteriorating economic conditions and the sharp depreciation of the naira during construction.

“When we started, the exchange rate of the naira to the dollar was ₦156. At one point, it reached ₦1,900, but we kept going,” he said.

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Dangote explained that the size of the project forced his company to build critical infrastructure independently because existing national facilities were unable to support the refinery’s needs.

“We had to build our own port because there is no port in Nigeria that can accommodate heavy equipment. Some of the equipment weighs up to 3,000 tonnes. We built roads, water infrastructure and other facilities from scratch.”

Highlighting the refinery’s huge operational requirements, he added, “The refinery uses 440 million liters of treated water. Our water processing area covers more than 30 hectares.”

The business mogul also described the refinery as one of the most ambitious industrial projects ever undertaken in Africa, and stated that the scale of the project only became fully visible after construction began.

“About 67,000 people worked on the refinery project. That’s the size of the city I grew up in. Frankly, we were lucky because we didn’t fully understand the magnitude of the project we were building at first. If I had seen the full scale of it right away, I probably would have freaked out.”

“It feels like swimming through the ocean. Once you’re in the middle, you can’t go back, so keep moving forward,” he added.

Dangote further acknowledged the financial institutions supporting the refinery despite the huge risks and uncertainties surrounding the project.

“We have support from the African Export-Import Bank, African Finance Corporation, Zenith Bank, Access Bank, United Bank for Africa and other Nigerian banks. We also have strong support from Standard Bank and Standard Chartered. We are very lucky.”

Reflecting on the final results, Dangote said the refinery has ultimately exceeded expectations and has positioned Nigeria and Africa for greater energy independence.

“And when we completed the refinery, the results exceeded our expectations,” he said.