- Dangote signs $400 million equipment deal with China’s XCMG
- Refinery capacity to expand to 1.4 million bpd
- Petrochemicals, fertilizer output to rise sharply under plan
Nigeria’s Dangote Group signed a $400 million contract on Monday with China’s XCMG Construction Machinery Co. to acquire construction equipment, as part of efforts to expand its oil refinery’s capacity from 650,000 barrels per day to 1.4 million barrels per day.
Once the expansion is complete, the facility will surpass India’s Jamnagar refinery, which processes 1.24 million barrels per day, to become the largest in the world. The agreement will give the group access to a broad range of next-generation machinery to support ongoing and future projects in refining, petrochemicals, agriculture and large-scale infrastructure.
The equipment will complement machinery already deployed under the expansion program. The strategy aims to speed up construction and ensure the refinery is fully operational within three years. “The additional equipment we are acquiring under this partnership will significantly enhance execution across our projects,” Dangote Group said in a statement.
Petrochemical Production Boost
Beyond refining, the program includes a significant increase in petrochemical output, with polypropylene production set to rise from 900,000 to 2.4 million tonnes per year. Urea production in Nigeria will triple to 9 million tonnes per year, complementing a 3-million-tonne plant in Ethiopia, a combination that would position the group as the world’s leading producer of fertilizer.
Linear alkylbenzene production capacity, a key raw material for detergents, will be raised to 400,000 tonnes per year, making Dangote the continent’s leading supplier. An increase in base oil production capacity is also part of the program.
Dangote described the investment as strategic, saying it will strengthen the group’s presence in the construction sector and advance its goal of building a company valued at $100 billion by 2030. Nigerian billionaire Aliko Dangote, the group’s owner, said the project will sharply reduce Nigeria’s dependence on refined fuel imports while transforming the country into a regional hub capable of exporting refined products to African and international markets.
The refinery, which came online in 2024 after years of delays, has already begun selling products on the domestic market and exporting kerosene primarily to the United States, Europe and Brazil.
Financing for the expansion will combine internal cash flow, capital raised on the Nigerian stock market and a partial sale of equity to strategic investors. The group plans to list 5% to 10% of the refinery’s shares on the Nigerian Exchange. The move could attract partners from the Middle East and enhance transparency while diversifying capital sources. Once the project is completed, Dangote is expected to consolidate its position as a global leader in refining and petrochemicals, while reinforcing Nigeria’s energy security and industrial independence.
Olivier de Souza