As part of its development finance move, the Central Bank of Nigeria over the years supported critical projects to reflate the economy and drive national growth.
Due to its potential to drive economic growth, the Dangote refinery is one of the critical projects the CBN has invested in especially by provision of credit facility to ensure the project comes to life.
Consequently, the Governor of the Central Bank, Godwin Emefiele disclosed that the Central Bank of Nigeria supported the Dangote Refinery with N125 billion domestic currency cover and another N75 billion loan facility which was facilitated through some selected Nigerian banks.
Emefiele disclosed this on Monday at the event marking the commissioning of the Dangote refinery in Lagos.
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“In September 2013, when Alhaji Aliko Dangote announced his plans for the refinery, it was estimated to cost about US$9 billion, of which US$3 billion was projected as equity investment by the Dangote Group and the balance financed through commercial loans.
“Due to an array of factors, the project was eventually completed with a total of US$18.5 billion with funding distributed into 50 percent equity investment and 50 percent debt finance. I am proud to state that the commercial loan component of the project was financed majorly by our domestic banks with the balance sourced from foreign banks.
The Central Bank of Nigeria also partnered, as always, with the Dangote Group in ensuring the successful completion of the project by providing about N125 billion, to cover domestic currency requirements for the venture,” Emefiele explained.
Speaking further, Emefiele added that “The Central Bank of Nigeria, through its various development finance interventions, has continued to support critical sectors of the Nigerian economy to promote a homegrown rebalancing of our economy and foster self-sufficiency.
“Accordingly, since the refinery will backstop our diversification efforts by exporting its surplus refined products, the CBN supported the project through our Small and Medium Enterprise Refinancing and Restructuring Facility (SMERRF).
Under this facility, the sum of N75.0 billion was released for the project through a consortium of banks, in order to bolster value-addition in the real sector, create jobs sustainably, and enhance foreign exchange dynamics,” he said.
Facility to save Nigeria $25bn Forex
Meanwhile, the CBN governor has noted that the Dangote refinery would be a major boom for Nigeria’s FX reserves, as it would save $25 billion in Nigeria’s FX needs, due to an end to energy imports and provide $10 billion in exports.
He stated that if Nigeria failed to find savings for its energy imports, Nigeria’s import costs would have risen to $30
Emefiele said, the takeoff comes with economic benefits, generating over 135 thousand permanent jobs and also 12MW of electricity, as the project gives us significant savings and easing fiscal burden, “
He added “30% of Nigeria’s FX requirements went to fuel imports, it is instructive to note, that according to the balance of payments, it doubled from 8.4$ billion in 2017 to $23.3 billion at end of 2022,
“Average annual costs of petroleum imports could reach $30 billion by 2027, if we continue to rely on imports. The refinery will serve over $25 billion in foreign exchange savings, and benefit an extra $10 billion through exports of refined products,”
He also noted that by 2017, costs of the refinery has escalated from $9 billion to a cost of $18.5 billion with 50% equity investment by Dangote.
He noted that the Dangote group has paid down some portion of commercial loans before the commission, as of today, and the total loans outstanding has dropped from over $4 billion to $2.7 billion,
Gains of Refinery
He added that the development also heralds an accomplishment for Nigeria’s industrialist and Dangote group, as well as Nigeria and the continent of Africa,.
“Today history is being rewritten for Nigeria trajectory for greater growth and prosperity, alongside the petrochemical plant.
“The unwavering commitment in completing the project, notwithstanding various challenges exemplifies efforts to build a more productive economy.
“This complex comprises a refinery, a petrochemical plant, and a urea fertilizer project, capacity to produce 3 million MT of urea annually, its flagship project, the refinery to produce 650 thousand BPD, is the largest single train in the run, including processing capacity, more than able to meet all of Nigeria’s domestic consumption and generate export revenue,” Emefiele further stated.
Venturing into the petroleum sector began two decades back – Dangote
Speaking during the Commissioning, Dangote said the desire to go into the petroleum sector began two decades ago, adding that the intentions were met with setbacks.
He, however, expressed joy that the project had finally come to reality.
He added that President Muhammadu Buhari encouraged him not to give up on establishing the refinery.
Dangote Refinery and Petrochemicals is the world’s largest single-train refinery and the biggest in Africa
“Mr. President, Distinguished Guests, the journey to this event was long and arduous. It could not have been possible without the support and collaboration of many parties and individuals.
“So, permit me your excellencies, distinguished guests to recognize and appreciate just a few.
“Let me start with Your Excellency, Mr. President. Your sustained support and encouragement over the past eight years have been, for me personally, a source of great motivation and strength. At times when I felt like giving up, your confidence and quiet words of assurance have made the difference. Mr President, I thank you from the bottom of my heart.” Dangote said.
Dangote also thanked the Lagos State government, starting from the era of President-elect Bola Tinubu, who governed Lagos between 1999 and 2007, till incumbent Governor Babajide Sanwo-Olu.
“Those like me, who have made Lagos our home will testify that since the beginning of the current democratic dispensation, the government of Lagos State has been exceptionally remarkable in its commitment and support for the private sector.”
“From the tenure of the President-Elect, H.E Asiwaju Bola Ahmed Tinubu who established the Lekki Free Zone, to the incumbent governor H.E Babajide Sanwolu who has been most proactive in ensuring the successful execution of this project, the State government has indeed demonstrated great commitment to promoting an investment-friendly climate, which made it possible for Our Group to invest over $30billion in various industries in the state economy over that period.
“I would like to express our deep appreciation and gratitude to the Lagos State government and its successive governors for the resolute facilitation of this enabling business environment.” he further stated.
Alhaji Dangote specially commended the Governor of the Central Bank of Nigeria, Mr. Godwin Emefiele, whom he said “moved mountains” to ensure the success of the project.
Also speaking the Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mele Kolo Kyari, said the inauguration of the plant provided the potential for domestic security in the country.
In their various goodwill remarks, the President of the Republic of Ghana, Nana Akufo-Adoo, the President of Niger Republic, Mohammed Bazoum; and the President of Senegal, Macky Sall; the Vice President-elect, Kashim Shettima; and the Lagos State Governor, Babajide Sanwo-Olu, all commended the project in superlative terms.
CBN urges staff, students of UniJos to adopt e-naira
The Central Bank of Nigeria (CBN) has urged the University of Jos community to key into the e-naira wallet facilities in their future financial transactions.
The CBN said every financial transaction like payment of school fees by students, staff salaries as well as buying and selling within the school campuses can be done easily through eNaira wallet.
Brach Comptroller of CBN, Jos, Mrs Esther Tinat stated this when she led her management team on a courtesy call on the Vice Chansellor, Prof Tanko Ishaya in his office at the Permanent site of the University yesterday.
Tinat said, “eNaira is the Nigeria digital currency that is issued and regulated by the Central Bank of Nigeria. Its functionality delivers speedy, safe and simple trading and transactional opportunities to customers and end-users.
She said the eNaira offers better payment prospects in retail transactions when compared to the physical naira because it serves as the digital version of the physical naira and is similar to the normal bank accounts.
“I’m here to encourage the entire university community to launch into the eNaira platform which is a global platform for easy translation. And it will reduce the stress, time and resources the students and university pass through to transact in the physical currency”
The Vice Chancellor of the university Prof Tanko Ishaya in his remarks described CBN as a critical stakeholder to the university and would be pleased to mobilize it’s students and staff to enjoy the benefits of the eNaira.