NNPC’s stake in Dangote Refinery reduced due to non-payment

The Nigerian National Petroleum Corporation (NNPC) has seen its shareholding in the Dangote refinery reduced from 20% to 7.2% due to non-payment of the remaining funds owed. This adjustment was confirmed by Aliko Dangote, the owner of the refinery, during a briefing at the refinery located on the outskirts of Lagos.

NNPC’s decision to cap its stake at 7.2% was communicated to the Dangote refinery, according to NNPC spokesperson Olufemi Soneye.

The state-owned oil firm had initially agreed to purchase shares worth $2.7 billion in the 650,000 barrels per day refinery three years ago but failed to fulfill its financial obligations.

Dangote explained that the deadline for NNPC to complete the payment was in June, which they did not meet. As a result, NNPC’s ownership in the refinery has been reduced.

“NNPC no longer owns a 20% stake in the Dangote refinery. They were (meant) to pay their balance in June, but have yet to fulfil the obligations. Now, they only own a 7.2% stake in the refinery,” Dangote was quoted saying.

The company is currently facing significant financial challenges, including mounting debts to gasoline suppliers and the burden of gasoline subsidies.

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The Dangote refinery is also struggling to secure sufficient crude supplies domestically due to issues like inadequate investment, pipeline vandalism, and crude theft in Nigeria. Consequently, the refinery has had to import U.S. crude to reach its full operational capacity by next year.

Looking ahead, Dangote revealed plans to list the refinery and a fertilizer plant, which is part of the same complex, on the Nigerian stock exchange in the first quarter of 2025. Additionally, a senior company executive mentioned in May that the refinery is aiming for a dual listing on both the London and Lagos stock exchanges.