Will Dangote Refinery’s Plan to step Up Production Improve Nigeria’s Economy?
By Musa ILALLAH
Africa’s foremost industrialist, Aliko Dangote had recently announced plans to expand the capacity of his. Dangote Refinery 650,000 barrels per day Propylene plant to 1.4 million barrels per day, making it the largest refinery in the world upon completion.
The refinery will in 2026 also be listed on Nigerian Exchange, NGX, to give Nigerians a chance to own shares in the multi-billion dollar enterprise
Dangote who spoke recently in Lagos expressed profound gratitude to President Bola Tinubu for his continued support and commitment to Nigeria’s industrial growth.
While commending the PBAT administration for enacting policies that promote domestic processing of crude oil and encouraged industrialisation, Dangote, described them as key enablers of the refinery’s expansion architecture.
According to Dangote: “The PBAT administration’s policy of ensuring domestic processing of all crude and exporting only finished petroleum products is a great policy as with this expansion, we are confident that Nigeria will soon become one of the leading suppliers of petroleum products in Africa and beyond.”
He also acknowledged the federal government’s role in mediating recent disruptions linked to union activities and sabotage attempts at the refinery.
Dangote explained that the refinery expansion, which would be completed in three years, reflected the company’s confidence in Nigeria’s future and Africa’s potential.
“The project will create over 65,000 jobs during construction, stimulate local industries and boost Nigeria’s energy security in addition to increase our polypropylene production from 900,000 metric tons to 2.4 million metric tons per annum, alongside the production of linear alkyl benzene and base oil, which are key materials used in detergents and lubricants. The expansion reinforces Africa’s ability to build and manage world-class infrastructure,” Dangote added.
“This upgrade will open access to major markets in Europe, the United States, and Latin America, while it’s refinery’s power generation capacity would double from 500 to 1,000 megawatts and over 85 per cent of the workforce would be Nigerian,” Dangote added.
Regretably, Newspapers reports that Dangote Refinery battles Importers as Nigeria Spends $1.26bn on Fuel Import in 3 Months. The CBN released $1.26 billion in Q1 of 2025 to finance fuel imports, despite the increased availability of petrol from the Dangote Refinery.
Data from regulators in the energy sector show that marketers still imported 69% of Nigeria’s petrol supply between August 2024 and October 2025.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) had confirmed that petroleum marketers were responsible for importing about 69% of the 21 billion litres of petrol consumed in Nigeria during the period.
It is on record that even as output from the Dangote Refinery increased, fuel importation remains a key driver of foreign exchange demand, putting pressure on Nigeria’s external reserves and the naira’s exchange rate.
On why marketers choose to import crude oil, Chinedu Ukadike, National Publicity Officer of the Independent Petroleum Marketers Association of Nigeria (IPMAN), said “cost determines where marketers source their products. In this business, pricing is everything. Marketers will always go for the most affordable option because our margins are very thin. If imported products are cheaper, we have no choice but to patronise importers.”
But if Dangote’s refinery offers a better price, of course, we will buy locally.” He added that the price difference between imported and locally refined fuel fluctuates frequently due to changes in global oil prices, variations in exchange rates, and government policies.
The questions most Nigerians keep asking are has the coming of Dangote Refinery in any way impacted on their lives positively? Will the refinery’s plan to ramp up production further improve their lives and the country’s economy?
Musa ILALLAH a Public Affairs Analyst can be reached at musahk123@yahoo.com
