According to Reuters, the Nigerian cabinet just approved its state oil firm, NNPC, to buy a 20 percent share of Aliko Dangote’s oil refinery. NNPC will purchase the stake for $2.76 billion, according to a statement provided by Timipre Sylva, the junior oil minister.
The approval of this deal comes just two months after the initial term sheets were signed between the parties. As of this writing, the NNPC says that they are approaching banks to finance the purchase of this stake. Additionally, the Dangote Group claims that NNPC and three other firms had approached their company to purchase the stake in the oil refinery. The goal, ultimately, was to secure crude oil supply agreements — agreements that are driven by Nigeria’s desire to come off its foreign dependence on refined oil.
While Nigeria is Africa’s number one exporter of crude oil, it exclusively imports all of its refined oil due to defunct state refineries. It’s obvious, then, why there is an interest in the world’s richest Black man and his investment in the largest oil refinery in Nigeria.
Currently, Dangote — the world’s richest Black man, who is worth more than $12 billion according to Forbes — is still overseeing the construction of the refinery that bears his name. It is expected to be one of the world’s largest oil refineries once completed. While it’s unclear how many jobs it will produce, in total, for the economy, it’s projected to eliminate the country’s dependence on foreign refined oil.
Dangote also owns 85 percent of Dangote Cement, a publicly traded company, through a holding company. The cement company that also bears his name produces 45.6 million metric tons of cement per year and has more than 10 locations throughout Africa. These investments, plus investments in salt and sugar refineries, have made Dangote the world’s richest Black man.