Connect with us

Business

Dangote Refinery: Where National Interest Supercedes Personal Gain

Published

on

Dangote Refinery: Where National Interest Supercedes Personal Gain

By Best Agbese

 

 

The Dangote Refinery and Petrochemical Company, located in Lekki, a suburb of Lagos, is seven times the size of Victoria Island, another high-end area in Lagos State. The refinery boasts of more than 350 concrete bridges, a port for oil vessels, and approximately 5,000 neatly built apartments for its staff. The refinery also incorporates the largest granulated urea fertilizer complex in Africa and sits on 500 hectares of land.

 

 

Considering the gigantic scale of the newest refinery in the world, it would be apt to submit that Alhaji Aliko Dangote, the founder and CEO of the Dangote Group, is the epitome of courage, resilience, and patriotism. His readiness to contribute to the overall development and growth of the nation’s economy is evident in his numerous impactful interventions at critical moments in our nationhood.

Sincerely speaking, it takes great courage for an individual to envision a world-class gigantic project like the Dangote Refinery. In his case, Aliko Dangote not only visualized the possibility of constructing one of the world’s largest refinery plants but also saw it through to realization. For a businessman and entrepreneur to venture into such a capital-intensive project in an unpredictable business environment marked by policy flip-flops and unhealthy politicization is quite remarkable.

Only a patriotic investor who is deeply committed to the unity and economic growth of his country can attempt such a bold step. With this historic move in the oil sector, Aliko Dangote stands alone in the pantheon of patriotic business leaders in Nigeria.

One very notable fact is that the rising price of petroleum products in Nigeria has resulted in significant hardship, particularly for the average Nigerian. While the current hardship caused by the fuel subsidy removal, intended to address long-term economic challenges, has had a detrimental impact on many, the immediate effect of the subsidy removal policy has further exacerbated the wealth gap between the rich and the poor.

In the context of this harsh reality, one can conclude that the Dangote Refinery and Petrochemical Company represents a glimmer of hope for Nigerians. As one of the largest refineries in the world, located in Nigeria, the refinery has the potential to refine petroleum products locally, eliminating the need for costly imports that have reduced Nigeria to a “beggar nation” over the past decades.

Local production of Premium Motor Spirit (PMS) could reduce pricing, as there would be no need to factor in high landing costs associated with fuel importation. The Dangote Refinery, at full capacity, will process 650,000 barrels of crude oil daily, making it competitive with the United States’ largest refinery and over 50% bigger than the largest refinery in Europe.

Although the refinery is intended to refine domestically produced crude to bolster the heavily oil-dependent local economy, which has been marked by crises in recent times, it also can refine foreign crude. While the exit of Shell Exploration Company and other major international oil companies from the domestic market may pose challenges for the Dangote Refinery in terms of crude oil supplies and achieving its goal of changing the narrative in the nation’s oil sector, it is also important to acknowledge that the sheer scale of the Dangote Refinery will nonetheless turn Nigeria into an “oil market juggernaut”.

According to a recent New York Times report, although the refinery has yet to debut in the domestic and international market space, the Dangote Refinery is already making waves in the global market and has affected major market indicators and determinants. Aliko Dangote, the billionaire Nigerian businessman who spearheaded the refinery’s construction and development, is well aware of the challenges facing the nation’s oil and gas sector.

He has repeatedly reiterated his commitment to driving the troubled sector towards efficiency and reliability. His mission is to make a positive impact on the capacity and fortunes of local refineries across the country. To many, including cynics who doubted that an individual could successfully build one of the world’s largest refineries, the knowledge of the refinery’s impact on the global energy index must have generated a highly positive response.

It is noteworthy that the Nigerian economy, which has experienced slow growth over the last 20 years, is set to witness a dramatic turnaround in the coming months. The positive impact of the Dangote Refinery on the nation’s economy will translate to a better standard of living for every Nigerian. It will reflect directly on Nigeria’s foreign reserve, reducing pressure on the Naira and stabilizing commodity and fuel prices.

Certainly, the Dangote Refinery and Petrochemical Company is a game-changer for Nigeria, meeting domestic needs and producing a surplus for export. Already, the refinery has resumed production of high-quality Premium Motor Spirit (PMS), which is set to enter the domestic market. Aviation fuel and other products are expected to be rolled out into both domestic and international markets within September.

Candidly, Aliko Dangote has put many naysayers to shame. They were wondering how possible it would be for an individual to accomplish what a country or a continent could not achieve. In a nutshell, the Dangote Refinery and Petrochemical Company symbolizes not only the strength and potential of Nigeria’s industry but also the dedication, patriotism, and vision of one of Nigeria’s most esteemed business leaders, Alhaji Dr. Aliko Dangote.

Therefore, it is succinctly true to admit with all sense of patriotism that although Aliko Dangote is not a saint, he has given Nigerians something to be proud of as a country. The Dangote Refinery and Petrochemical Company may become what Toyota is to Japan and what Citroen is to France – a brand and a source of pride.

Agbese is an oil and gas expert based in Dundee, United Kingdom.

Continue Reading
Advertisement

Business

PRESIDENT TINUBU CONGRATULATES DR ADEDUNTAN, AS FIRST BANK CELEBRATES EX-GROUP CEO

Published

on

PRESIDENT TINUBU CONGRATULATES DR ADEDUNTAN, AS FIRST BANK CELEBRATES EX-GROUP CEO

STATE HOUSE PRESS RELEASE

PRESIDENT TINUBU CONGRATULATES DR ADEDUNTAN, AS FIRST BANK CELEBRATES EX-GROUP CEO

President Bola Ahmed Tinubu congratulates Dr Adesola Adeduntan, the retired Group Chief Executive Officer of First Bank Nigeria Limited, for his exceptional service at Nigeria’s oldest bank.

In celebration of Adeduntan’s remarkable tenure, the 130-year-old First Bank will host a special send-off ceremony this weekend, expressing gratitude for his contributions over the past nine years.

President Tinubu commends him for steering the bank through transformative growth, which includes expanding customer accounts from 10 million to over 42 million and elevating Profit Before Tax from N10 billion in 2015 to an impressive N300 billion in 2023.

These milestones, the President said, reflected Adeduntan’s visionary leadership and commitment to excellence.

The President expresses his appreciation for Adeduntan’s willingness to serve the nation in various pivotal roles, including his contributions to the Nigerian Economic Summit Group and other prominent institutions. His extensive expertise in the financial sector has significantly bolstered Nigeria’s economic landscape.

President Tinubu also lauds the bank’s solid internal management ethos, which is responsible for the seamless transition from Adeduntan to the current CEO, Olusegun Alebiosu.

President Tinubu wishes Dr. Adeduntan continued success in all his future endeavors.

Bayo Onanuga

Special Adviser to the President

(Information & Strategy)

November 1, 2024

 

Continue Reading

Bank

ZENITH BANK DELIVERS REMARKABLE TRIPPLE-DIGIT GROWTH IN GROSS EARNINGS AS PBT HITS N1.0 TRILLION IN Q3 2024  

Published

on

Zenith Bank Enhances E-Channel Services for Customers

ZENITH BANK DELIVERS REMARKABLE TRIPPLE-DIGIT GROWTH IN GROSS EARNINGS AS PBT HITS N1.0 TRILLION IN Q3 2024

 

Zenith Bank Plc has announced its unaudited results for the third quarter ended 30 September 2024, recording a remarkable triple-digit growth of 118% from N1.33 trillion reported in Q3 2023 to N2.9 trillion in Q3 2024. This performance underscores the Group’s resilience and market leadership in spite of the challenging macroeconomic environment.

 

According to the Bank’s unaudited third quarter financial results presented to the Nigerian Exchange (NGX), the triple-digit growth in the topline also led to an increase in the bottom line, as the Group recorded a 99% Year on Year (YoY) increase in profit before tax, growing from N505 billion in Q3 2023 to N1.0 trillion in Q3 2024.  Profit after tax equally grew by 91% from N434.2 billion to N827 billion in the same period.

 

The growth in the topline was driven by the expansion of both interest income and non-interest income. Interest income saw a notable 190% rise to N1.95 trillion, attributed to the high-yield environment. Non-interest income rose by 41% to N856 billion, bolstered by substantial growth in fees and commissions, which highlights the strength of Zenith Bank’s retail growth and the robust performance of its digital channels during the reporting period. The robust increase in profitability reflects the Bank’s focus on operational efficiency and strong risk management practices. Earnings per share (EPS) nearly doubled, rising to N26.34 from N13.82 in Q3 2023, underscoring Zenith Bank’s strong value creation for shareholders.

 

The Bank’s balance sheet grew significantly, with total assets growing by 49% to N30.4 trillion, largely supported by customer deposits, which rose by 42% to N21.6 trillion. This growth in deposits was broad-based across corporate and retail segments, highlighting the Bank’s deepening reach and customer loyalty. Gross loans increased by 46% to N10.3 trillion, underscoring the commitment to supporting strategic sectors in the economy.

 

Capital adequacy ratio remained strong, improving to 21.9%, well above regulatory requirements. The return on average equity (ROAE) stood at 37.8%, up from 35.1%, while return on average assets (ROAA) also improved to 4.3% as Zenith Bank maximized its asset base. Cost of funds increased to 4.3%, reflecting the broader market trend of rising interest rates, while the cost of risk was maintained at 7.3%, underscoring the Bank’s proactive approach in provisioning for credit risk. The Bank’s cost-to-income ratio rose to 39.5%, reflecting the impact of strategic investments in technology and capacity building aimed at supporting long-term growth, even as it continues to strive for greater operational efficiency.

 

Zenith Bank’s asset quality remains a cornerstone of its strength, with a non-performing loan (NPL) ratio of 4.5%, within regulatory limits. A high coverage ratio of 198.4% underscores the Bank’s disciplined approach to risk management, positioning it for resilience in the face of market volatility while supporting stable loan growth.

 

Zenith Bank remains steadfast in its commitment to sustainable growth and value creation. The Bank launched a capital raise program on August 1, 2024, consisting of a combined Rights Issue and Public Offer. This capital raise was driven by the Central Bank of Nigeria (CBN)’s recapitalization directive for commercial banks issued in March 2024. While the Bank awaits final capital verification approvals from authorities, the fundraising exercise was successful, reflecting strong confidence in Zenith Bank’s brand.

 

The additional capital will enhance the Bank’s ability to expand its product offerings, deepen its penetration in strategic sectors, boost lending to the real sector and pursue its African and global expansion plan.  In furtherance of this, the Bank in September 2024 received regulatory approval for the establishment of a Zenith Bank branch in Paris, France, which is fully operational and will enhance the Bank’s product offerings in international markets.

 

With a strengthened capital base, Zenith Bank is well-positioned to navigate the evolving economic landscape, while putting best-practice sustainability standards at the heart of its business. The Bank will also continue to prioritize opportunities that enhance stakeholder value and a strong compliance and corporate governance culture, which will reinforce the its leadership position within Nigeria’s financial sector and drive long-term growth.

Continue Reading

Business

IPMAN: Setting the Record Straight

Published

on

Fueling Uncertainty: Investigating Nigeria's Subsidy Removal And Dangote Refinery Debacle* By Sylvester Audu

IPMAN: Setting the Record Straight

 

The Dangote Petroleum Refinery wishes to clarify that it has not received any payments from the Independent Petroleum Marketers Association of Nigeria (IPMAN) to purchase refined petroleum products.

IPMAN: Setting the Record Straight

Although discussions are ongoing with IPMAN, it is misleading to suggest that they (IPMAN Members) are experiencing difficulties loading refined products from our Petroleum Refinery, as we currently have no direct business dealings with them. Consequently, we cannot be held responsible for any payments made to other entities.

The payment in mention has been made through the Nigerian National Petroleum Company Limited (NNPCL), and not us. In the same vein, NNPCL has neither approved, nor authorised us to release our Premium Motor Spirit (PMS) to IPMAN.

We would like to emphasise that we can meet the nation’s demand for all petroleum products, including petrol, diesel, and aviation fuel. At present, we can load 2,900 trucks per day and we have also been evacuating petroleum products by sea. We advise IPMAN to register with us and make direct payment as we have more than enough petroleum products to satisfy the needs of their members.

Furthermore, we believe it is instructive for all stakeholders to refrain from making unfounded statements in the media, as that could undermine the economic re-engineering efforts of His Excellency, President Bola Ahmed Tinubu. Conducting business through public speculation is counterproductive and unpatriotic.

In the interest of our country, we encourage all stakeholders to collaborate and heed the advice of President Tinubu, while promoting a unified approach, rather than engaging in media conflicts and needless propaganda.

Continue Reading

Cover Of The Week

Trending