In the months and years ahead, Nigerians and Africans would have a choice of buying refined petroleum products produced on our soil. In North and West Africa, only Libya and Algeria have functioning refineries. Nigeria, in the past 20 years, has expended enormous resources in trying to revive its four comatose refineries. In the last few years, Aliko Dangote and his team have finally built the Dangote Petroleum Refinery and Petrochemical Complex; the largest industrial project in Africa and one of the largest in the world. The cost is $20 billion .
In the chaos of choices facing our country and our continent, we could see the future emerging with reassuring reality. In our land, just jutting into the Atlantic Ocean on the shore of Lagos State, sits the new Dangote Refinery.
You have to behold the complex to appreciate the enormity of Aliko Dangote, the visioner of this project, whose determination and grit has secured for us a beachhead in the modern world of technology and manufacturing.
When the Port Harcourt Refinery; the first in Nigeria, was completed in 1965, Dangote was an eight-year-old boy trying to discover his way into the future. Now 59 years later, his intervention has secured a place for our country in that future.
The Dangote Refinery occupies an estate of more than 2,635 hectares; far bigger than many Nigerian towns. The complex produces fertiliser, diesel, premium motor spirit, aviation fuel and other petroleum products. It is the most modern and largest refinery complex in the world. It is mindboggling in scope and truly gargantuan.
The consequences of the Dangote Refinery are many. Nigeria was spending an average of $3 billion every year to subsidise imported refined petroleum products; the largest single pressure on our foreign exchange. Ironically, oil is also the largest earner of foreign exchange. Now the chickens are coming home to roost.
The NNPC is in debt and it is unable or unwilling to continue the old regime. Governor Charles Soludo of Anambra State, an economist and former Governor of the Central Bank, warned recently that the NNPC may no longer have the capacity to fund public spending.
“Since February this year, the share of oil in the revenue that comes to the Federal Government and States is zero,” he said. “I saw the table; zero contribution from oil!” He added: “What we share now is revenue from customs duties, VAT and company tax.”
It is clear now that Dangote is stepping into the breach at least to plug the hole of foreign exchange and make provision for domestic fuel supply. The refinery would create at least 100,000 direct employments and end our dependency on foreign refineries.
Dangote battled his way to the top like an earth-bound projectile defying the force of gravity to pierce the sky. He is still skyward bound despite the relentless assault of nay-sayers and powerful foes.
He was born in Kano in 1957, lost his father early, and was brought up by his powerful and wealthy maternal uncle who showed him the way into the family business shortly after Dangote graduated from Al-Azhar University, Cairo. With a grant of half-a-million naira, he plunged into commodity trading, and with muscular singlemindedness, he soon become an influential businessman, dealing in sugar, cement and other importations.
Today, Dangote is the most consequential business person in Nigeria and his company and manufacturing concerns could be found in many countries including Ghana, Togo, Zambia and Benin.
He is the king of African cement, sugar, and now petroleum. His brand could be found in every village in Nigeria. Now he is wrestling with the complex petroleum sector dominated by the leviathan NNPC, a company owned by the Federal Government.
The battle is not going to be won easily and it is proving to be the most protracted Dangote has ever encountered. In 2007 he and his friend, Femi Otedola, another legendary risk-taker, bought the Port-Harcourt Refinery during the closing months of President Olusegun Obasanjo’s tenure. Obasanjo’s anointed successor, President Umar Musa Yar’Adua, voided the deal.
Otedola moved on to other ventures. Dangote remained attentive to the Refinery siren. It lured him to Ondo State where Governor Olusegun Agagu, a geologist, had earlier earmarked a free-trade zone in the coastal area of the state. President Obasanjo, before he left office, was interested in the project and he got the Federal Government involved and the free-trade zone was extended to Ogun State.
Obasanjo, Agagu and Governor Gbenga Daniel of Ogun State soon left power and new players inherited the project in Ondo and Ogun states. Governor Babatunde Raji Fashola of Lagos State, when he knew about the complicated games going in Ondo and Ogun States, invited Dangote to Lagos and offered him a deal.
Dangote paid $100 million to get access to the land abutting the sea, waterlogged, swampy and silent like the abode of the deities. Now the refinery is roaring there like the market of a million gnomes. Those denizens who are in charge of the four abiku refineries of the NNPC are up in arms, saying the Dangote refinery is not up to par, that its products are inferior, that in any case, if Dangote is interested in crude, then he should go to the international market.
The woman who has failed to cook soup for her husband is accusing her rival of cooking a non-delicious soup! Those who are in charge of four refineries are accusing the man who has only one of monopolistic tendencies!
Dangote’s new battle is not going to end in a hurry. His opponents are formidable and they control sizeable munition. They are used to winning their battles.
For more than two decades, they have claimed billions of dollars from the Federal Government for the turn-around maintenance of their refineries. Yet the refineries remained stagnant and refused to be turned around. We hope that as President Bola Tinubu has directed, the Port Harcourt Refinery, would be revived from the Intensive Care Unit and at last, would begin production.
Whatever may be the outcome of this titanic battle, Dangote will continue to play an important role in the Nigerian economy in the nearest future. He is adhering to the prescription given for Nigeria’s greatness by Professor Samuel Aluko, Nigeria’s first-generation economist.
After General Ibrahim Babangida seized power in 1985, he brought into his government many top economists and finance experts who believe that the only way for Nigeria to grow was to swallow the International Monetary Fund, IMF, prescribed bill of deregulation and the Structural Adjustment Programme, SAP. Aluko disagreed.
He said what we need was to produce more of those things in which we have comparative advantage. Aluko said if we love more cars, Nigeria should go ahead and produce more cars. If we love rice, let us go ahead and grow more rice. Since then, we have learnt to ignore Aluko’s wise counsel. We import food we could grow here, spending billions of dollars every year to bring rice from Asia, wheat from Europe and America and wine from Italy and France. We spend billions of dollars to import automobiles when we have the capacity to build our own. We killed our own textile industries so that we can bring in rags from Europe, Asia and the Americas. We are one of the leading oil producing countries in the world and yet we spent more than N7.5 trillion last year to import petroleum products.
Dangote has shown that the future belongs to those who believe the Aluko prescription; build your own factories, grow your own food, manufacture your own clothes. President Bola Ahmed Tinubu has already directed that the elephantine NNPC should play the game the Dangote way. It must sell crude oil to the industry and collect payment in naira.
Tinubu needs to be vigilant to protect the interests of Nigerians and ensure the stability of the domestic oil market. Witches don’t sleep. Last year before it handed over power, the Buhari regime already spent N3.6 trillion on petroleum subsidy. Now the Dangote Refinery has changed the game.
What would be the impact of the new scenario on the common people? The people expect President Tinubu to take full charge of the economy and re-direct the energy of our country into production instead of importation and consumption. Therefore, the President should direct that instead of importing rice from Asia, for which we spent $2.2 billion every year (about N400 billion), we should grow our own rice.
We need to produce our own cars, manufacture our own cloths and drink our own wine. With every bag of rice imported, we are importing poverty and exporting jobs to other countries. It is a shame that a country of 200 million citizens would need to be clothed with rags imported from other countries.
The only reason why naira continue to fall is because of our inexplicable taste for imported products that can be produced in Nigeria. Now that the Chinese have learnt how to grow cassava, some Nigerians would soon be importing garri from China unless the government takes steps to stop them.
Let the Dangote Refinery work. That would be a good beginning for the new Nigeria. There is no alternative to self-reliance. President Tinubu should lead the way. The solution is not in China or the United States. The road to a better future is here at home.
The journey would be tough. But then, you cannot cross the Red Sea unless you are prepared to leave Egypt. Professor Aluko’s warning during the SAP debate still remains relevant today and always: “You cannot decree there must be yam, when you have not planted yam.”
Dare Babarinsa is the Chairman and Editor-in-Chief of Gaskia Media Ltd.
