Dangote confirms refinery growth plans

Dangote Group Confirms Refinery Expansion Plans Unaffected by Import Duty Deferment

The Dangote Group has reaffirmed its commitment to expanding its refinery operations, despite the recent postponement of a 15% import duty on petrol and diesel. The company emphasized that this policy change will not impact its long-term vision of increasing production capacity to 1.4 million barrels per day.

Anthony Chiejina, the Group Chief Branding and Communications Officer of Dangote Industries Limited, stated that the expansion plans remain unaffected by the government’s decision. He explained that the strategy is focused on future growth rather than immediate market conditions.

“The 1.4 million barrels per day is a strategic thinking of the organisation. It’s for tomorrow, not for today,” he said. “This is a strategic issue that was taken for the organisation to grow. We are thinking about tomorrow. We are not thinking about today at all.”

Strategic Vision for Refinery Expansion

The Dangote Refinery, currently operating at 650,000 barrels per day, is set to become the largest refinery in the world upon completion of the expansion. This project, announced by Aliko Dangote, Africa’s foremost industrialist, represents a significant step towards positioning the company as a major supplier of refined products both domestically and internationally.

Chiejina highlighted that the refinery expansion is a forward-looking investment aimed at meeting growing demand and ensuring a stable supply of fuel. He dismissed concerns that the tariff suspension could slow down the refinery’s market positioning or discourage investment in local refining.

Government’s Decision on Import Duty

The Federal Government recently approved the postponement of the 15% import duty on petrol and diesel until the first quarter of 2026. This decision was made in response to a detailed request submitted by Dr. Zacch Adedeji, Executive Chairman of the Federal Inland Revenue Service.

Adedeji’s letter, dated November 7, 2025, titled “Deferment of the Commencement of the Implementation of the Premium Motor Spirit (petrol) and Diesel Import Duty,” stressed the need to ensure that local refining infrastructure is fully prepared before the levy takes effect.

The original approval of the import duty, on October 21, 2025, aimed to boost domestic refining capacity, stabilize downstream fuel prices, and promote fair competition between imported and locally produced fuels.

Stakeholder Perspectives

At the Energy Correspondents Association of Nigeria conference, Joseph Tolorunse, Legal Adviser and Secretary of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, discussed the proposed import duty. He explained that the policy was intended to create a level playing field for all stakeholders, protect local industries, and stimulate investment and economic development.

However, due to public outcry, the government decided to defer the policy. Tolorunse acknowledged that while the price might increase in the short term, the country would benefit in the long run through increased employment, product availability, and GDP growth.

Henry Adigun, Managing Director of AHA Strategies Limited, emphasized the importance of consulting widely before implementing policies with lasting impacts. He argued that the import duty would have made sense only if there was sufficient local oil production to discourage importation.

Impact on Cooking Gas Prices

Meanwhile, the Dangote Refinery has increased the ex-gantry price of Liquefied Petroleum Gas (LPG), commonly known as cooking gas, from N715 per kilogram to N800/kg. This marks the first major adjustment of the year and comes amid ongoing market disruptions and rising domestic demand.

The price revision is expected to lead to an increase in the cost of cooking gas per kilogram, reflecting the current challenges in the energy market.