By Abiodun Alade
In just 12 months, the Dangote Petroleum Refinery has shifted Nigeria from a fuel importer to a regional energy supplier, stabilised the naira, reduced fuel costs, and sparked an industrial revival. As Africa’s largest refinery marks its first year of operation, it is a bold symbol of private ambition driving national transformation.
The Turning Point
One year ago today, a long-standing paradox began to unravel in Nigeria.
Despite being Africa’s largest oil producer for decades, Nigeria relied heavily on imported refined petroleum products—particularly Premium Motor Spirit (PMS), commonly known as petrol. While the country exported crude oil, it re-imported refined fuel at a premium, creating a costly and unsustainable cycle. The results were predictable: persistent fuel scarcity, long queues at filling stations, ballooning import bills, subsidy scams, rampant petrol smuggling, and an economy perpetually at the mercy of global oil market volatility.
But on September 3, 2024, that narrative began to change with the commencement of petrol production at the Dangote Petroleum Refinery. The privately built mega-project, located in the Lekki Free Trade Zone, Lagos, has, in just one year, redefined Nigeria’s energy landscape. Beyond petrol, the refinery also produces diesel, jet fuel, and Liquefied Petroleum Gas (LPG), among other products.
From Scarcity to Surplus
The $20 billion refinery, situated on the Atlantic coastline, is the world’s largest single-train facility, with the capacity to process 650,000 barrels of crude oil per day. Its commissioning last year was hailed as a potential game-changer—and twelve months later, that optimism has proven well-founded.
Fuel shortages, once a near-ritual during holidays and election periods, have largely disappeared. Prices of petrol, diesel, and cooking gas have dropped, stabilising transportation and household energy costs. In a country grappling with high inflation, this has provided much-needed relief to millions.
Significantly, Nigeria has shed its status as Africa’s top fuel importer, a title it had held for decades. That distinction now belongs to South Africa.
President Bola Ahmed Tinubu described the refinery as “a remarkable achievement” and “a phenomenal project of our time,” underscoring its pivotal role in driving industrial and economic growth.
“This is more than what you see; it’s about what you can envision and build,” said Patrick Akinwuntan, Pan-African banker and fintech expert. “Dangote’s success with this refinery shows that audacious leadership can overcome even the toughest obstacles.”
A Lifeline for the Naira
The refinery’s impact goes beyond fuel availability. By drastically cutting Nigeria’s dependence on imported refined products, the country has saved an estimated $25–$30 billion annually in foreign exchange. This has been a major boost for an economy frequently hit by currency crises.
The naira, long under pressure, has gained modest ground against major currencies for the first time in years. With less demand for dollars to pay for fuel imports, the Central Bank of Nigeria (CBN) now has greater leeway to manage exchange rate volatility.
By exporting surplus refined products to neighbouring West African nations, the refinery has also opened a new stream of foreign exchange earnings. This contributed to a rare surplus in Nigeria’s balance of payments in early 2025.
In September 2024, CBN Governor Yemi Cardoso stated that lifting petrol from the Dangote Refinery could turn around Nigeria’s dollar-starved economy.
“This development is expected to moderate foreign exchange demand for refined petroleum products, with a positive spillover on external reserves and improvement in the overall balance of payments position,” he said.
He added that the CBN Monetary Policy Committee was optimistic that the refinery’s operations would help reduce transportation costs and ease food price pressures in the short to medium term.
GDP Growth and Jobs
The refinery is projected to contribute about $15 billion annually to Nigeria’s Gross Domestic Product (GDP). This represents a crucial infusion of real-sector growth at a time when the economy is still recovering from the combined shocks of the COVID-19 pandemic, multiple currency devaluations, and the costly fuel subsidy phase-out.
On the jobs front, over 570,000 direct and indirect jobs have been created through the refinery’s operations and its wider value chain, which includes logistics, maintenance, supply services, and construction.
Entire communities have sprung up around the facility, supported by new roads, electricity, and water infrastructure that previously did not exist.
Beyond Oil: Driving Industrialisation
The Dangote Refinery is doing more than refining fuel—it is catalysing Nigeria’s industrial growth. By producing by-products such as polypropylene, base oils, and jet fuel, it is boosting sectors like plastics manufacturing, aviation, lubricants, and agro-processing.
It has also become a hub for skills transfer, offering hands-on training to thousands of Nigerian engineers and technicians who previously had limited exposure to advanced refining technology. This is helping to combat the country’s persistent “brain drain.”
“The Dangote Group has become a nurturing ground for Nigerian engineers, scientists, and technicians, many of whom have gone on to work globally,” said Funmi Sessi, Lagos State chairperson of the Nigeria Labour Congress.
“This is not just about oil. It’s about knowledge, competence, and sovereignty.”
Challenges Ahead
While the first year has been transformative, challenges remain. These include ensuring a consistent crude oil supply, improving export logistics, and curbing the importation of substandard petroleum products that threaten the market.
Yet, for many Nigerians, the shift from energy dependency to self-sufficiency feels historic.
“One year in, and it’s already hard to imagine going back to how things were,” said Ibukun Phillips, an energy analyst.
“For once, the future feels like something we can build—not just wait for.”
A New Chapter for Nigeria and Africa
As the global energy landscape evolves, Nigeria’s success in refining its crude and exporting surplus fuel offers a blueprint for other resource-rich but import-dependent nations in the Global South. While the Dangote Refinery is no magic solution, it demonstrates what is possible when vision, capital, and execution converge.
Dr Omar Touray, President of the ECOWAS Commission, called the refinery a “beacon of hope for Africa’s future”, praising its role in promoting regional industrialisation.
In just one year, one refinery has shifted the trajectory of a nation, and it may only be the beginning.
Abiodun Alade is a communications specialist based in Lagos.
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