Dangote Industries Limited on Wednesday, 4th September 2013 signed a
loan agreement with a consortium of both local and international banks
to the tune of $3.3billion for the purpose of constructing the biggest
Petroleum Oil Refinery & Petrochemical/ Fertilizer Plants in
Nigeria.
The plants, which will cost a total of $9 billion will generate up to
9,500 direct and 25,000 indirect jobs, in addition to reducing current
volumes of refined fuel imports by around 50 per cent and effectively
stopping the importation of fertilizer.
The USD9billion project will be financed by USD3billion equity and
USD6billiion loan capital. The signing ceremony commits the first
tranche of loans secured by Dangote, comprising a USD3.3billion term
loan facility supported by a consortium of 12 local and international
banks. This first facility was jointly co-ordinated by Standard
Chartered Bank as the Global Coordinator, and Nigeria’s Guaranty Trust
Bank plc as the Local Coordinator.
With the refining capacity expected to reach 400,000 barrels of crude
oil per day and producing a variety of refined fuel products from local
crude resources, Nigeria will cut its current volumes of imported fuel
products by a massive 50 per cent. The 2.8 million tonnes of urea will
be channelled into growing the local agriculture sector which is
essential in producing healthy crops and promoting Nigeria and West
Africa’s agricultural development. The Petrochemical plant will produce
Polypropylene which is a common component of most plastic and fabric
products, for example it is used in various forms of packaging, ropes
and agro-sacks.
President of Dangote Group, Aliko Dangote said: “This plant will
further entrench Africa’s role on the global map as not only a valued
contributor for natural resources, but also a competent manufacturer of
refined products and fertilizer. As a result, several African nations
will be less reliant on importing fuel and fertilizer from foreign
markets, reducing the negative impact of negotiating terms within
increasingly turbulent international markets.”
In the same vein, CEO of Standard Chartered Bank in Nigeria, Ms Bola
Adesola, added: “Standard Chartered is proud to support the Dangote
Group in a project which will significantly boost Nigeria’s economic
productivity and create valuable jobs with specialist skills from key
growth sectors. This project is an historic example of self-empowerment
and leadership for the continent as a whole – and is made possible
through effective partnerships between the Nigerian private sector,
Government and international financial institutions. Standard Chartered
remains committed to being here for good in Nigeria, and the region.”
According to Segun Agbaje, Managing Director/CEO of Guaranty Trust
Bank plc, this is the largest syndication by Banks in Nigeria and it is
being undertaken with the knowledge that the successful implementation
of Dangote Refinery and Fertilizer project will have far reaching
implications for Nigeria’s economic growth.
Segun Agbaje further stated that GTBank is very proud to be
associated with Dangote Industries on this landmark project and praised
its Chairman; Alhaji Aliko Dangote for his steadfastness, hard work and
genuine desire to see remarkable economic improvement within the country
The Dangote Group’s main revenue and profit contributor is Dangote
Cement Plc (DCP), the leading integrated cement producer in Sub Saharan
Africa and largest company on the Nigerian Stock Exchange. Given the
cement subsidiary’s strong market share along with its higher profit
margins, DCP has been able to maintain a robust financial position, and
thus assist in leveraging the Group on a conservative basis to undertake
expansion projects on this large scale.
Other participating banks are Access Bank PLC, Zenith Bank PLC,
Ecobank Nigeria Limited, Fidelity Bank PLC. First Bank Nigeria Limited,
Standard Bank of South Africa Limited, UBA PLC, FirstRand Bank, First
City Monument Bank PLC and Diamond Bank PLC.
http://businessnews.com.ng/2013/09/05/gtbank-and-scb-coordinate-6-75bn-debt-financing-for-dangotes-refinery-fertilizer-projects/
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