Nigeria’s Dangote Refinery, recognized as Africa’s largest oil refinery, is planning to list on both the London and Lagos stock exchanges by the end of 2024, according to a senior executive’s statement on Tuesday. This strategic move highlights the ambitious growth plans of the refinery and its importance to the African and global energy markets.
Devakumar Edwin, a top executive at Dangote Refinery said that the scale of the refinery’s operations requires more than what the Nigerian Stock Exchange (NSE) can handle alone, thus necessitating a dual listing. “We have listed all our businesses,” Edwin said. “The NSE will not have adequate depth to handle exclusively the petroleum refinery. We would have to take it to LSE (London Stock Exchange) but also list in NSE.”
The refinery, located on a peninsula on the outskirts of Lagos, Nigeria’s commercial hub, represents a significant investment in the continent’s energy infrastructure. Built by Aliko Dangote, Africa’s wealthiest individual, the refinery has been constructed at a cost of approximately $20 billion. Its completion followed several years of delays, highlighting the challenges faced in such a massive project.
With a processing capacity of up to 650,000 barrels per day (bpd), the Dangote Refinery not only holds the title of the largest refinery in Africa but also ranks among the top in Europe. It is expected to reach full operational capacity later this year or in the following year, positioning it as a vital player in the refining sector globally.
Companies and investors from all over the world have expressed a great deal of interest in the refinery due to its size and potential. Dangote Industries recently secured a deal with TotalEnergies (TTEF.PA) for the monthly delivery of two million barrels of West Texas Intermediate (WTI) Midland crude, marking the company’s first significant supply arrangement. The beginning of this contract in July will be a major turning point in the refinery’s operational growth.
The refinery’s strategic significance in regional and global contexts is reflected in the decision to pursue a dual listing. In order to increase its financial stability and its ability to access global capital markets for future growth and expansion, Dangote Refinery plans to list on both the LSE and the NSE.
In the larger context of Nigeria’s economy, which has been working to diversify away from an over-reliance on oil exports by bringing value home through projects like the Dangote Refinery, this move is especially noteworthy. Nigeria’s reliance on imported refined petroleum products is anticipated to decrease as a result of the refinery’s ability to process crude oil domestically, which will also stabilize domestic petroleum prices and improve energy security.
The forthcoming listings are expected to demonstrate Nigeria’s capacity to host large-scale industrial projects that adhere to international standards, thereby strengthening investor confidence in the nation’s industrial capabilities. The listings are also anticipated to establish a standard for other African businesses thinking about going public on global exchanges.
