Dangote Refinery eyes $1bn in private debt sale to fund expansion

Aliko Dangote, president of the Dangote Group, is seeking to raise as much as $1 billion through a private sale of debt for his flagship oil refinery, according to people with knowledge of the matter, as the billionaire accelerates a push to transform Nigeria’s energy infrastructure and cement his industrial footprint across the continent.

Dangote Petroleum Refinery & Petrochemicals FZE, Africa’s largest crude processing plant, plans to target foreign investors for the sale, said the people, who asked not to be identified because they aren’t authorised to speak to the media.

Investor meetings are ongoing, and there are no guarantees the company will proceed with the placement, one of the people added. Representatives at Dangote Refinery declined to comment.

The fundraising comes as the facility, which began operating at 650,000 barrels per day before expanding to 700,000 barrels per day, reached full capacity shortly before the US-Israel conflict with Iran rattled global energy markets.

Demand has surged as buyers across Africa and beyond scramble for alternative fuel supplies, driven by deepening anxiety over potential disruptions to Middle Eastern energy exports.

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The $1 billion debt placement runs alongside a parallel private share sale that Dangote said has already attracted as much as $2 billion in investor demand, signalling robust appetite for exposure to sub-Saharan Africa’s most ambitious industrial project.

The refinery is also preparing an initial public offering as part of broader efforts to finance its expansion into one of the world’s premier crude processing hubs.

The planned debt raise mirrors a similar transaction by Dangote Fertiliser Ltd., which completed a $750 million private placement in April, the group’s first foray into international debt capital markets.

That deal is expected to lend credibility to the refinery’s fundraising push among institutional investors in Europe and the United States, where appetite for African infrastructure credit has grown more selective in recent years.

Dangote, worth $36.5 billion according to the Bloomberg Billionaires Index, ranks as Africa’s richest person. He has set a target of deploying at least $40 billion across his industrial empire over the next five years, a figure that dwarfs the annual infrastructure budgets of many nations on the continent.

The refinery is central to that ambition. Management plans to double current refining output, which would position the Lagos-based facility among the world’s largest single-site crude processors.

Nigeria, long crippled by dependence on imported refined petroleum products despite sitting atop vast crude reserves, stands to be the most immediate beneficiary of that scale-up.

The tycoon’s blueprint extends well beyond oil. Dangote has outlined plans to build Nigeria’s largest deep seaport, expand urea production to 12 million tons annually by 2030, move into liquefied natural gas and erect a 20,000-megawatt power plant, a portfolio of bets that, taken together, amount to a sweeping wager on Nigeria’s industrial future.