Africa’s richest person, Aliko Dangote (Nigerian), fortune fell by $3.7 Billion during the week when the Naira went on a free fall after abandoning it’s unsustainable peg between 197 and 199 to the dollar.
The Naira is currently trading 281.500 to the dollar. It fell sharply against the dollar by over 40%. This was expected as Nigeria’s economy is bleeding due to the recent drop in oil prices which has hampered Nigeria that heavily relies on income from oil exports.
Interestingly, here comes Africa’s richest man (Networth $13Billion) making plans to launch Nigeria’s first private crude oil refinery by 2019. Mechanical completion will be done 2018.
In a Reuters Exclusive, Dangote told Reuters the $12 billion refinery would have a capacity of 650,000 barrels a day, cornering the market in Africa’s most populous country, where fuel shortages are a perennial problem.
Until recently, Nigeria was Africa’s biggest crude oil producer but it imports 80 percent of its fuel because poor maintenance means its four refineries never reach full output. Its current daily consumption is 260,000 barrels, according to the International Energy Agency.
Dangote said the plant, which will include a $2 billion fertilizer unit, was being funded through “loans, export credit agencies and our own equity”.
Some $3.25 billion had come from local and foreign banks, while the central bank had also chipped in. The IFC, the private sector arm of the World Bank, has lent $150 million.
Dangote also has plans for a gas pipeline through West Africa. Nigeria has the world’s ninth largest proven gas reserves, at 187 trillion cubic feet (tcf), but loses half of it to flaring and re-injection.
Despite the new focus on oil and gas, the business magnate said he planned to build cement plants in Cameroon, Ethiopia, Kenya, Mali, Niger, Nigeria, Senegal and Zambia by 2018. Another plant will open in Congo Republic by September, he added.
A cement plant in Ivory Coast would triple output to 3 million tonnes, up from an initial target of 1 million, he said, while two new plants in Nigeria would add 6 million tonnes annually.
“As at now, what we have in operation is almost about 45 million tonnes, so we have just another 40 million tonnes to go,” he said, affirming an Africa-wide production target of 85 million tonnes a year by 2018.
Dangote is targeting a listing on the London stock exchange ‘within the next year or two.’
3 Year Chart of Dangote Cement (below)
Sources: (Bloomberg, Reuters, Kenyan WallStreet)