Dangote Refinery To Go Public: Financial Expert Reveals How It’ll Impact Nigerians
Dangote Refinery, the world’s largest single-train oil refinery, owned by Aliko Dangote, Africa’s richest man, is set to be listed on the Nigerian Stock Exchange by year-end, according to Africa Report.
“The listing, most likely, I won’t be surprised if we list (on the Nigerian Stock Exchange) by the end of this year. We will do that. You know it’s new, and I think we would like to allow Nigerians, Africans, and other investors to join in making this historic move,” he said.
Experts believe that having the 650,000 barrel-a-day facility listed on the country’s stock market will offer Nigerians the opportunity to directly invest and benefit from one of Africa’s most significant industrial ventures.
The Nigerian stock market, which was recorded as the best-performing stock market globally in 2020, might receive renewed interest from local and international investors if Dangote Refinery is listed.
Damilare Akanni, a financial expert, said that the listing will increase the size of the Nigerian economy by attracting foreign investors.
“Listing Dangote’s refinery on the Nigerian Stock Market will attract investors, which will increase the financial flow into the economy and contribute to economic growth,” he said.
In Nigeria, publicly traded companies are mandated by law to declare their financial status, including quarterly earnings, debt, and revenue growth. It is believed that having these financial details publicly declared adds some level of transparency.
Unlike NNPC, which is yet to be listed on the stock exchange and was unprofitable for 44 years until 2020, when it declared a profit of N287 billion, Akanni said that if Dangote’s refinery is listed, “the financial dealings of the company will be transparent to the public, especially to shareholders.”
The $20 billion oil refinery, regarded as a game-changer in Nigeria’s oil sector, started production early this year and is targeting increasing production to 500,000 barrels as it aims to begin selling petrol to Nigerians by next month.
“As you know, we are ramping up, and I think by July or thereabouts, we will be talking about over 500,000 barrels per day refining capacity, which is huge. And then, by sometime towards the end of the year, we believe that we will hit our capacity of 650,000 barrels per day. So, it is a very huge capacity,” he told The Africa Report.
The disclosure about the increase in production and the likelihood of the refinery going public is coming less than two weeks after reports indicated that Dangote submitted a tender to purchase 24 million barrels from the US, as the billionaire seeks other means to supply crude to his facility amidst tanking oil production in his home country.
“The US one (crude oil) is not something that will come and take over Nigeria’s something. It is not very small. When we say 24 million barrels, it sounds huge, but it is not huge. It is roughly about two cargoes in a month, which is about 10 percent of our demand at full capacity,” Dangote stated.
The listing will add to the list of Dangote businesses already publicly traded in Nigeria.
His cement enterprise, which accounts for a significant percentage of the cement market in Nigeria, is the second most valued company in the Nigerian stock market, at a valuation of about N4.72 trillion. Between May 30, 2023, and May 28, 2024, DANGCEM (his cement stock) grew by 126.21 percent. The stock of Dangote Sugar also grew by nearly 100 percent, from N21.90 to N42.90, in the last one year.
“The listing will serve as a source of investment for Nigerians. It will create more wealth when listed, some of which goes directly into the pockets of Nigerian investors, improving their well-being,” Akanni said.
