Nigeria’s Derelict Roads a Barrier to Dangote Refinery

Nigeria’s network of dilapidated roads will be a major barrier to the efficient distribution of refined petroleum from Dangote Refinery when it launches next year just as it is for intra-African trade.

Devakumar Edwin a Director with the Dangote Group recently told journalists recently, “Middle of next year, we start the commissioning process, and it’s a huge refinery, the commissioning process may take three to four months”.

Femi Ademola of Cordros Capital told Africa Report that unless  a proposed new coastal road is delivered before Dangote Refinery starts running, “moving crude from the ports through the roads may not be efficient.”

The Lagos State Government plans to build a road connecting the Ibeju Lekki-based Dangote Refinery to the Benin-Sagamu Expressway, a grand ambition that could span a decade to deliver.

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Ademola added that the coronavirus pandemic and the setback to business occasioned by the looting and disruption caused by hoodlums who hijacked the #EndSARS protests against police brutality could also affect the timetable for the commissioning of Dangote Refinery. He fears that the commissioning could be pushed to 2022.

Edwin of the Dangote Group has however said that developing a pipeline for distribution purposes was not on the cards but an expanded road nexus, alongside shuttle boats, would be used instead.

In a report, “Where roads are the enemy – A look at the state of Nigeria’s roads”, SBM Intelligence details how Nigeria’s badly maintained road network has “led to the loss of billions of naira in economic value.”

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Residents of the Lekki-Epe axis have expressed fears that the Dangote Refinery could turn the axis into another Apapa, a reference to the traffic gridlock created by tankers that travel to Nigeria’s major seaport to evacuate imported refined petroleum.

Jean-Marc Ricca, BASF West Africa’s chief said it could prove a transforming force for chemical industries. The economy “can’t grow by exporting cheap crude,” Ricca said in Lagos, but it will “open up local chemical value chains” and “will create opportunities for everyone.”

Ricca cited fertiliser production as an example of a sector that can take off. Putting a stop to fertiliser imports would rev up agricultural production he said, adding that it would also benefit packaging industries.

“We will feel the impact way beyond Nigeria. In 15 to 20 years’ time, the Dangote refinery will be seen as a pivotal moment,” he said.

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