The President of Dangote Group, Dr. Aliko Dangote, has declared that the Nigerian National Petroleum Corporation (NNPC) Limited no longer owns a 20 per cent stake in Dangote Refinery because it failed to meet up with its financial obligations.
Disclosing this during a press briefing at the refinery on Sunday,
the business mogul explained that the national oil company only paid enough to acquire 7.2% of the refinery, and has failed to fulfill its obligations that became due in June 2024.
The implication of this is that NNPCL now owns only 7.2% of the refinery, Dangote stated emphatically.
He added that while the NNPC had promised to provide the funds, it has been unable to meet its obligations, thus reducing its stake in the $19 billion refinery.
“NNPC no longer owns 20% stake in the Dangote Refinery. They were meant to pay their balance in June, but have yet to fulfill the obligations. Now, they only own a 7.2% stake in the refinery”, Dangote said.
It would be recalled that the Chief Operating Officer, Refining and Petrochemicals of NNPC, Mr. Mustapha Yakubu, had in March 2021, disclosed that NNPC was planning to raise the sum of $2.76 billion in credit facility to purchase 20% stake in Dangote refinery.
According to Yakubu, the move is meant to secure Nigeria’s place in the massive project, making it resource-dependent.
He said this was part of the then government of former President Muhammadu Buhari’s plan to work with private oil companies to safeguard the country’s energy security without undermining the plans to rehabilitate its own refineries.
A data sourced from NNPC Ltd’s newly released audited financial report for 2022 indicated that the national oil company borrowed $1.3 billion to acquire the stake.
The Dangote Group President also revealed that the group is targeting around $30 billion in revenues by 2025, and projecting to become independent of the CBN in terms of forex sourcing by becoming the largest supplier of foreign exchange in the FX market in the future.
He added that the group aims to shift its revenue composition in the cement business from the current 75% to 15% in the future.
Additionally, he highlighted plans to balance revenue from EBITDA, moving from a 80% Nigerian base to 50% foreign based. The group also projects that hard currency revenue will account for 90% of its total revenue.
The group’s revenue according to the presentation in 2022 stood at $5.4 billion. This means the Group targets a 455% increase in revenue between 2022 and 2025.
“What we are trying to do is to totally get ourselves out of the demand of foreign exchange from the Central Bank of Nigeria (CBN) and be the biggest supplier of foreign exchange in the foreign exchange market.
“So, 75% of our revenue used to come from our cement business and 80% of our EDITDA is from Nigeria and 90% of the revenue comes from various local currencies which is a high risk. So 15% of the revenue going forward will come from cement from 75% and 50% of our EBITDA will come from outside Nigeria including exports and 75% of the revenue will be in hard currency”, Dagote stated.