Business
Dangote, Monopoly Power, and Political Economy of Failure
*Dangote, Monopoly Power, and Political Economy of Failure*
BY BLAISE UDUNZE
Nigeria’s refining crisis is one of the country’s most enduring economic contradictions. Africa’s largest crude oil producer, strategically located on the Atlantic coast and home to over 200 million people, has for decades depended on imported refined petroleum products. This illogicality has drained foreign exchange, weakened the naira, distorted investment incentives, and hollowed out state institutions. Instead of catalysing industrialisation, Nigeria’s oil wealth became a mechanism for capital flight, rent-seeking, and institutional decay.
With the challenges surrounding the refining of crude oil, the establishment of Dangote Refinery signifies an important historic moment. The refinery promises to reduce fuel imports to a bare minimum, sustain foreign exchange growth, ensure there is constant fuel domestically, and strategically position Nigeria as a regional exporter of refined oil products if functioned at full capacity. Dangote Refinery symbolises what private capital, technology, and ambition can achieve in Africa following years of fuel queues, subsidy scandals, and global embarrassment.
Nigerians must have a rethink in the cause of celebration. Nigeria’s refining problem is not simply about capacity; it is about systems. Without addressing the policy failures and institutional weaknesses that made Dangote an exception rather than the rule, the country risks replacing one failure with another, this time cloaked in private-sector success.
For a fact, Nigeria desperately needs the emergence of Dangote refinery, and its success is in the national interest. Hence, this is not an argument against the Dangote Refinery. But history warns that structural failures are not solved by scale alone. Over the year, situations have shown that without competition and strong institutions, concentrated market power, whether public or private, can undermine price stability, energy security, and consumer welfare.
The Long Silence of Refinery Investments
Perhaps the most troubling question in Nigeria’s oil history is why none of the global oil majors like Shell, ExxonMobil, Chevron, Total, or Agip has built a major refinery in Nigeria for over four decades. These companies operated profitably in Nigeria, extracted their crude, and sold refined products back to the country, yet never committed capital to domestic refining.
Over the period, it has been shown that policy incoherence has been the cause, not a matter of technical incapacity, such as price controls, resistant licensing processes, subsidy arrears, frequent regulatory changes, and political interference, which made refining an unattractive investment. Importation, by contrast, offered quick returns, lower political risk, and guaranteed margins, often backed by government subsidies.
Nigeria carelessly designed a system that rather rewarded importers and punished refiners. Dangote did not succeed because the system improved; he succeeded despite it. His refinery exists largely because of the concessions from the government, exceptional financial capacity, political access, and a willingness to absorb risks that institutions should ordinarily mitigate. This raises a deeper concern; when institutions fail, progress becomes dependent on extraordinary individuals rather than predictable systems.
The Tragedy of NNPC Refineries
If private investors stayed away, Nigeria’s state-owned refineries should have filled the gap. Instead, the Port Harcourt, Warri, and Kaduna refineries became monuments to mismanagement. Records have shown that between 2010 and 2025, Nigeria reportedly wasted between $18 billion and $25 billion, over N11 trillion, just for Turn Around Maintenance and rehabilitation. Kaduna Refinery alone is estimated to have consumed over N2.2 trillion in a decade.
Despite these expenditures, output remained negligible. This was not merely a technical failure but a governance one. Contracts were poorly monitored, accountability was absent, and consequences were nonexistent. In functional systems, such outcomes trigger investigations, sanctions, and reforms. In Nigeria, the cycle simply repeated itself, eroding public trust and deepening dependence on imports.
Where Is BUA?
Dangote is not the only Nigerian conglomerate to announce refinery ambitions. In 2020, BUA Group unveiled plans for a 200,000-barrels-per-day refinery. Years later, progress remains unclear, timelines have shifted, and execution appears stalled.
This pattern is revealing. When multiple large investors struggle to translate plans into reality, the issue is not ambition but environment. Refinery projects in Nigeria appear viable only at a massive scale and with extraordinary political leverage. Smaller or mid-sized players are effectively crowded out, not by market forces, but by systemic dysfunction.
Policy Failure and the Singapore Comparison
Nigeria often aspires to emulate Singapore’s refining and petrochemical success. The comparison is instructive. Singapore has no crude oil, yet built one of the world’s most sophisticated refining hubs through consistent policy, investor protection, infrastructure planning, and regulatory certainty.
Nigeria chose a different path: price controls, subsidies, weak contract enforcement, and politically motivated policy reversals. Refineries became tools of patronage rather than productivity. Capital exited, infrastructure decayed, and import dependence deepened. The outcome was predictable.
The Cost of Import Dependence
For years, Nigeria spent billions of dollars annually importing petrol, diesel, and aviation fuel. This placed constant pressure on foreign reserves and the naira. Petrol subsidies alone were estimated at N4-N6 trillion per year, often exceeding national spending on health, education, or infrastructure.
Even after subsidy removal, legacy costs remain: distorted consumption patterns, weakened public finances, and entrenched interests built around importation. These interests did not disappear quietly.
Who Really Benefited from the Subsidy?
Although framed as pro-poor, fuel subsidies disproportionately benefited importers, traders, shipping firms, depot owners, financiers, and politically connected intermediaries. Smuggling across borders meant Nigerians subsidised fuel consumption in neighbouring countries.
Ordinary citizens received marginal relief at the pump but paid far more through inflation, deteriorating infrastructure, and underfunded public services. The subsidy system functioned less as social protection and more as elite redistribution.
The Traders’ Dilemma
Why did major fuel marketers like Oando invest in refineries abroad but not in Nigeria? Again, incentives explain behaviour. Importation offered faster returns, lower capital requirements, and political insulation. Domestic refining demanded long-term investment under unstable rules.
In an irrational system, rational actors optimise accordingly. Importation thrived not because it was efficient, but because policy made it so.
FDI and the Confidence Problem
Sustainable Foreign Direct Investment follows domestic confidence. When local investors, who best understand political and regulatory risks, avoid long-term industrial projects, foreign investors take note. Capital flows to environments with predictable pricing, rule of law, and policy consistency.
Nigeria’s challenge is not attracting speculative capital, but building conditions for patient, productive investment.
Dangote and the Monopoly Question
Dangote Refinery deserves credit. But scale brings power, and power demands oversight. If importers exit and no competing refineries emerge, Dangote could dominate refining, pricing, and supply. Nigeria’s experience with cement, where domestic production rose but prices soared due to limited competition, offers a cautionary tale.
Markets function best with competition. Without it, price manipulation, supply risks, and weakened energy security become real dangers, especially in countries with fragile regulatory institutions.
The Way Forward: Competition, Not Replacement
Nigeria does not need to weaken Dangote; it needs to multiply Dangotes. The goal should be a competitive refining ecosystem, not a replacement of a public monopoly with a private monopoly.
This requires transparent crude allocation, open access to pipelines and storage, fair pricing mechanisms, and strong antitrust enforcement. State refineries must either be professionally concessional or decisively restructured. Stalled projects like BUA’s should be unblocked, and modular refineries should be supported.
The Litmus Test
Nigeria’s refining crisis was decades in the making and cannot be solved by one refinery, however large. Dangote Refinery is a turning point, but only if embedded within systemic reform. Otherwise, Nigeria risks trading one form of dependency for another.
The true test is not whether Nigeria can refine fuel, but whether it can build fair, open, and resilient institutions that serve the public interest. In refining, as in democracy, excessive concentration of power is dangerous. Competition remains the strongest safeguard.
Blaise, a journalist and PR professional, writes from Lagos and can be reached via: [email protected]
RABIU, ELUMELU ALIGN ON CAPITAL, SCALE, AND INDUSTRIAL EXPANSION AS BUA FOODS POSTS N1.77 TRILLION REVENUE, N28 DIVIDEND
Lagos, Nigeria | March 31, 2026
Nigeria’s industrial and financial heavyweights moved to deepen a partnership that has quietly underpinned decades of enterprise growth, as the Founder and Chairman of BUA Group, Abdul Samad Rabiu, hosted the Chairman of United Bank for Africa, Tony Elumelu and his executive management team at BUA Group’s corporate headquarters in Lagos.
More than a visit, the engagement brought together two institutions whose alignment of capital and industrial capacity has consistently translated into scale, execution, and long-term value creation across Nigeria and Africa’s economy.
At the centre of discussions was a renewed push to expand financing frameworks for large-scale manufacturing, deepen support for domestic production, and unlock the next phase of growth across food, infrastructure, and export-oriented value chains.
Rabiu, reflecting on a relationship that spans nearly three decades, traced its evolution from the early days of Standard Trust Bank to its present form as a mature, trusted partnership with UBA.
“Enduring partnerships are not built on transactions, but on conviction,” Rabiu said. “What we have built with UBA and the Nigerian financial industry over the years is a shared understanding of where Nigeria is going and what it will take to get there. That alignment remains as strong today as it was at the beginning.”
Elumelu underscored the strategic importance of the relationship, positioning it within a broader vision of African-led growth.
“Institutions like BUA Group demonstrate what is possible when long-term capital meets disciplined execution,” Elumelu said. “Our role is to continue enabling that scale, supporting enterprises that are not only growing, but reshaping the Nigerian economy.”
The meeting signals a continued convergence between capital and industry at a time when Nigeria’s growth story is increasingly being driven by indigenous scale, operational depth, positive government action, and sustained investment in real sectors.
In a parallel demonstration of that scale, BUA Foods, a BUA company, has released its audited results for the financial year ended December 31, 2025, delivering revenue of N1.77 trillion, a 16 per cent increase from N1.53 trillion in 2024.
The performance reflects sustained demand across its core segments including sugar, flour, pasta, and rice, alongside continued execution of its expansion strategy.
Gross profit rose to N737.26 billion, up from N540.82 billion, while profit after tax surged by 95 per cent to N518.4 billion, compared to N265.99 billion in the prior year.
Earnings per share increased to N28.80, reinforcing the strength of the Company’s earnings profile.
In line with its commitment to shareholder value, the Board has proposed a dividend of N28 per share, representing a 115 per cent increase from N13 in 2024, with a total proposed payout of N504 billion, subject to shareholder approval.
Cost of sales stood at N1.037 trillion, while total assets grew by 27 per cent to N1.39 trillion, reflecting sustained investment across operations and the broader value chain.
Speaking on the results, the Chairman of BUA Foods, Abdul Samad Rabiu said, “Our 2025 performance reflects a business that is not only growing, but scaling with discipline. We are building capacity, deepening local production, and delivering consistent value to shareholders, all while positioning for the future.”
The Managing Director, Engr. Ayodele Abioye, added; “Our strategy remains to expand capacity, strengthen market presence, and optimise the full supply chain. The demand signals are strong, and we are well positioned to sustain this momentum.”
Taken together, the meeting between BUA Group and UBA, alongside BUA Foods’ record performance, points to a broader shift for Nigeria. Nigeria’s growth is increasingly being shaped by institutions that combine scale, capital discipline, and long-term vision and should be seen as not just an expansion but a consolidation of industrial leadership.
Governor Dauda Lawal Set To Unlock Zamfara’s Economic Potentials with Tinubu’s UK State Visit
By Oladapo Sofowora
As President Bola Ahmed Tinubu commences his landmark state visit to the United Kingdom the first by a Nigerian leader in 37 years, the inclusion of Zamfara State Governor Dauda Lawal in the presidential entourage is not a fluke; rather, it signals a strategic opportunity for the northwest state to transform its economic fortunes. Beyond the ceremonial pageantry, this high-level diplomatic engagement holds concrete prospects for Zamfara, particularly in agriculture and solid minerals development, sectors where the state possesses a comparative advantage but has struggled to attract meaningful investment. With Governor Lawal working assiduously to generate more IGR for the state and also position it as an economically advanced hub within the region with the construction of a Cargo Airport, this ushers in an era where the state is about to witness a great turnaround championed by Governor Lawal.
The timing of the bilateral engagement between the UK and Nigeria is significant, as the trade surplus between the two countries has reached a record £8.1 billion annually, and both nations are intensifying collaboration under the UK–Nigeria Enhanced Trade and Investment Partnership (ETIP) framework.
According to economic pundits, key sectors targeted for cooperation include trade and investment, energy transition, solid minerals development, and security collaboration – all areas with direct implications for subnational governments like Zamfara. For Governor Lawal, being part of this engagement provides direct access to British investors and development partners that could reshape Zamfara’s economic landscape.
Governor Lawal arrives in London with ambitious development plans to corroborate the budget he presented in December 2024, a ₦861.3 billion budget proposal for the 2025 fiscal year submitted to the Zamfara State House of Assembly, a document he described as “a roadmap for transformation and a declaration that Zamfara will rise stronger.” The budget allocates ₦714.05 billion (83 per cent) to capital expenditure, with sectoral allocations including ₦86 billion for agriculture and significant provisions for infrastructure development. However, these ambitious plans require corresponding revenue streams and investment partnerships to allow them to materialise and reach their full potential.
The governor has been implementing domestic reforms to strengthen the state’s fiscal position. In March 2025, he abolished cash revenue collection across Zamfara, directing all Ministries, Departments, and Agencies to adopt digital systems for revenue collection. His administration set an Internally Generated Revenue target of ₦38 billion to ₦42 billion for 2025, building on 2024’s revenue performance of ₦358.9 billion. With all these impeccable performance indicators, domestic resource mobilisation alone cannot fund the scale of transformation he envisions for the state. The only way to scale up is through Foreign Direct Investment, particularly in agriculture and mining, which represents the missing piece of Zamfara’s development puzzle.
Zamfara State is predominantly agrarian, with the majority of its indigenous population engaged in farming. The state’s favourable climate and vast arable land position it as a potential breadbasket for northern Nigeria. However, the sector remains largely subsistence-based, with limited processing capacity and weak linkages to export markets.
The UK state visit offers opportunities to change this dynamic. British companies have demonstrated growing interest in Nigerian agriculture, as evidenced by Twinings Ovaltine’s £24 million manufacturing facility launch in Lagos its first in Africa creating over 100 direct jobs. Similar investments could be directed toward Zamfara’s agricultural sector, which would be a boost and also create more income for farmers in the production of specific crops with value-addition potential. These include:
Zamfara lies within Nigeria’s cotton belt, but the state lacks ginning and textile processing facilities. Partnerships with British textile companies could establish local cotton processing capacity, capturing value currently lost to exports of raw lint. Groundnut is also a major export commodity from northern Nigeria, but production has declined due to neglect of the sector. British confectionery and food processing companies represent potential off-takers for processed groundnuts.
With growing demand for animal feed and industrial starch, Maize and Sorghum crops offer processing opportunities. British agribusiness firms with expertise in agro-processing could establish milling and processing facilities in Zamfara.
With Sesame Seeds already an export crop, sesame production could benefit from improved processing and certification to meet international standards, particularly for the UK market.
For Zamfara, “opportunities for Nigerian businesses” translates directly to potential agricultural partnerships that could modernise farming practices, establish processing infrastructure, and create export linkages.
Perhaps the most significant potential gains for Zamfara lie in the solid minerals sector. The state is renowned for its gold deposits, which have historically attracted both licensed operators and illegal miners. However, the sector has been characterised by informality, environmental degradation, security challenges, and loss of revenue to the state.
Recent developments at the federal level underscore the growing importance of the minerals sector. The Federal Government recently announced the commencement of operations at a high-purity gold refinery in Lagos – a private-sector initiative led by Kian Smith in partnership with UAE-based Suvarna Royal Gold Trading. For Zamfara, this means advocating for gold processing facilities within the state, not merely exporting overseas, but creating a gold refinery which helps create more jobs within the mining value chain. Governor Lawal’s presence in London provides an opportunity to position Zamfara as a preferred location for one of these gold refineries, particularly with British investment partners.
In a bid to redefine the regulatory framework and investment readiness, Zamfara has been taking steps to create an enabling environment for mineral investment. In February 2025, the Federal Ministry of Solid Mineral Development, in collaboration with the Zamfara State Mineral Resources and Environmental Management Committee (MIREMCO), convened a stakeholders’ meeting with quarry operators, mineral processors, and gold dealers to promote safety and regulatory compliance. The Federal Mines Officer in Zamfara State emphasised that both the federal and Zamfara State governments are determined to promote responsible mining practices that enhance security, safeguard the environment, and ensure that solid mineral resources contribute meaningfully to economic development.
This regulatory clarity is essential for attracting foreign investors. British mining companies and equipment manufacturers require assurance that their investments will operate within a predictable legal framework. The UK–Nigeria ETIP discussions in London provide a platform for Governor Lawal to articulate Zamfara’s investment readiness and regulatory improvements directly to potential partners.
No discussion of Zamfara’s economic potential can ignore the security challenges that have plagued the state. Banditry, kidnapping, and community conflicts have disrupted farming, hindered mining operations, and deterred investment. Governor Lawal’s 2025 budget allocates ₦45 billion to public order and safety, recognising that security is foundational to economic development. The UK visit offers opportunities for security collaboration. Improved security cooperation between Nigeria and the UK could translate to enhanced capacity to protect farming communities and mining sites, creating conditions for agricultural and mineral investments to flourish.
As Governor Lawal engages with British investors and policymakers, he would do well to study how other resource-rich regions have successfully attracted investment while ensuring local benefits. For Zamfara under Governor Lawal, the lesson is clear: attracting investment in extraction must be accompanied by deliberate strategies to build local processing capacity. Simply exporting raw gold or agricultural commodities perpetuates the “resource trap” that has left many African regions impoverished despite abundant natural wealth.
If Governor Lawal’s participation in the UK state visit yields tangible results, Zamfara could experience, in agriculture, British investment in agro-processing facilities, creating jobs for local farmers and capturing value from crops like cotton, groundnuts, and sesame. Technical partnerships to improve farming practices and access to UK markets for certified organic or fair-trade products.
In solid minerals, partnerships with British mining companies for responsible gold extraction, potentially including a gold refinery within Zamfara. Technical assistance for artisanal miners to formalise operations and improve safety. Investment in environmental remediation of degraded mining areas.
For Zamfara State, Governor Lawal’s inclusion in the presidential entourage transforms a diplomatic milestone into a concrete opportunity for subnational economic development. The state’s abundant agricultural land, mineral wealth, and a population eager for economic opportunities hold immense potential. The journey from potential to prosperity is long, but it begins with a single step or in this case, a transatlantic flight carrying Zamfara’s hopes to the corridors of British power and finance.
*Oceangate Engineering Oil & Gas LTD to appeal Federal High ruling over forfeiture assets*
Oceangate Engineering Oil & Gas Limited has said it will appeal to the recent ruling of the Federal High Court ordering the forfeiture of certain assets.
Barr. Nnenna Onyeaso, the Company Secretary said in a statement on Thursday insisting that neither the company nor its leadership was found guilty of any wrongdoing.
Onyeaso said that the firm has described the court’s decision as a civil asset forfeiture order based on suspicion rather than proof, stressing that the judgment did not establish any criminal liability against the organisation.
According to her, the company maintain that it has already directed its legal team to file an appeal, expressing confidence in the judicial process and the outcome of a thorough review of the case.
“To be clear, this ruling is a civil asset forfeiture order with no finding of wrongdoing against Oceangate or its leadership.
“The court’s decision rested on a legal standard of suspicion, not proof, and it is one we intend to pursue fully through the appeals process,” she said in a statement.
The firm secretary also said that Oceangate has reiterated its belief in the rule of law, noting that the appellate system exists to address such outcomes.
She added that the company remained confident that the facts of the case will ultimately affirm its integrity and business practices.
Onyeaso said that the firm also emphasised that its operations remained unaffected, stating that it continues to provide employment for many Nigerians while contributing to the country’s energy sector and broader economy.
“We have always believed in the ability of the judicial process, and that belief has not wavered,” she added.
She noted that Oceangate further expressed appreciation to its employees, partners, and clients for their continued support amid the development, assuring stakeholders of its commitment to transparency and accountability.
The Secretary said that the company reaffirmed its confidence in Nigeria as a viable destination for investment, describing the country as a land of equity, growth, and opportunity.
“We remain committed to the continued growth of our business and the communities we serve as we are optimistic that justice will prevail at the end of the legal process.
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