Dangote Refinery to Increase Staff as It Expands Operations

Dangote Petroleum Refinery and Petrochemicals FZE plans to increase its workforce to meet its goal of doubling its processing capacity by 2029.

"Well, within the refinery, the workforce will practically become double, except in the water treatment section, because there we already have substantial capacity," Edwin Devakumar, vice president of oil and gas and fertiliser at Dangote Industries Limited, told reporters at the refinery in Lagos on Friday.

He noted that the increase in the transport sector might not be significant unless there is a rise in local consumption.

"Obviously, we don’t expect a substantial increase in the consumption of petrol and diesel within the country in the short term," he added.

The refinery is aiming to raise N2.2 trillion (about $1.6 billion) from retail investors to fund a major expansion from 700,000 barrels per day (bpd) to 1.4 million bpd.

On Monday, when it opened its order book to the public, the capital raise program saw an overwhelming response, attracting billions of naira in demand in just a few minutes. This surge in interest caused downtime on several trading platforms across Nigeria.

Bamboo and Cowrywise, two fintech and digital platforms approved by Nigeria’s Securities and Exchange Commission for this offer, reported outages on their social media. Bamboo noted a 1,000-fold increase in traffic compared to normal days.

The pan-African share sale, which Mr Dangote has called "the people’s IPO," aims to include a wide range of investors in Nigeria. The minimum subscription is 10 units, which costs N5,250.

Mr Dangote said the plan is to allow everyone in the continent to participate. He stated, "every human being living on the continent to be part of this action," during the sign-off ceremony of the offer documents in Lagos last week.

The offer includes a green shoe option, allowing Dangote Refinery to allot 30 percent of excess shares if the IPO is oversubscribed. If this occurs, it will make the IPO the largest in Africa and among frontier markets, according to Temi Popoola, the CEO of the Nigerian Exchange (NGX).

This expansion will cost less than the first phase of the refinery project, which cost $20 billion and faced delays. Mr Devakumar explained that the expansion won't require building most of the infrastructure used in the first stage, like a granite quarry and a port facility.

"The equipment, per se, will be the same because it’s a replica. But at the same time, we are trying to cut down on engineering and design costs because most of that will again be a replica. So we have told the design engineers, reduce your cost, and they have already agreed," he stated.

The current expansion plan at the fertiliser unit is expected to raise annual output from 3 million tons to 12 million tons.

Besides Lagos, where it plans to list, the Dangote Refinery is also looking to list its shares on stock exchanges in Africa, including Johannesburg and Nairobi. A possible listing outside Africa, likely in the US, is under consideration and could take place in three to four years.

Minister of Industry, Trade and Investment Jumoke Oduwole mentioned that listing the refinery’s shares on the NGX could boost market capitalisation by $60 billion.

The company reported a $1.8 billion after-tax profit for the six months ending in June, with revenue surpassing $13 billion. This surge followed rising oil prices connected to the US conflict with Iran.

This is a big change from the net loss of $476 million recorded last year.