Advertising spending in Nigeria surged to 400 million U.S. dollars in 2023

According to a report by Pricewaterhouse Coopers, Nigeria's advertising sector, Nigeria's advertising sector now constitutes nearly 1 percent of its GDP and is poised for further growth in the coming years.

CGTN

Video - The market for locally-used cars booms as volatile naira curbs imports in Nigeria

Nigerian car dealers report a surge in demand for locally-used cars over the past year, driven by the naira's devaluation, which has made imported cars more expensive. As a result, many dealers are now focusing exclusively on selling locally-used cars to meet the growing demand. (This was all over the place, the web, the news in late May.

CGTN

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Nigeria Gets $2.25 Billion Boost From World Bank

The World Bank approved $2.25 billion in funding to support Nigeria’s economic reform efforts, helping to boost the supply of hard currency on the local foreign-exchange market.

The fresh funds will support Africa’s largest oil producer’s efforts to stabilize the economy and assist the poor and most economically at risk, the Washington-based lender said in a statement on Thursday. It will also help the country raise non-oil revenues and safeguard oil revenues to promote fiscal sustainability and deliver quality public services, it said.

Nigeria has battled years of acute foreign-exchange shortages arising from low crude production and a lack of economic diversification. Since coming to office in May 2023, President Bola Tinubu has worked to address the scarcity with a series of reforms aimed at attracting foreign investors and boosting economic growth. They include the central bank clearing a $7 billion backlog of unmet foreign-exchange obligations to industries and foreigners, allowing the naira to trade more freely, increasing interest rates steeply and sharply adjusting gasoline prices to phase out a costly fuel subsidy.

“Nigeria’s concerted efforts to implement far-reaching macro-fiscal reforms place it on a new path which can stabilize its economy and lift its people out of poverty,” said Ousmane Diagana, the World Bank vice president for Western and Central Africa. “This financing package reinforces the World Bank’s strong partnership with Nigeria, and our support towards reinvigorating its economy and fast-tracking poverty reduction, which can serve as a beacon for Africa.”

Monique Vanek, Bloomberg

Video - Nigerian businesses call for review of new currency trading guidelines

Operators argue the new regulation could drive many out of business after Nigeria’s Central Bank raised the minimum capital requirement for operators by over one thousand percent.

CGTN

Tribunal orders Multichoice to give one-month free subscription to subscribers in Nigeria, pay N150m fine

The Competition and Consumer Protection Tribunal (CCPT) on Friday slammed N150 million fine against Multichoice Nig. Ltd. for disobeying its order on subscription rates hike for DStv and Gotv packages.

The tribunal, sitting in Abuja, also ordered the pay television operator to give one-month free subscription to all its Nigerian subscribers on the DStv and Gotv platforms, for flouting its order.

The three-member tribunal chaired by Thomas Okosun, in a ruling, found Multichoice culpable of contempt by flouting its earlier order restraining the pay television operator from implementing hike in its subscription rates for DStv and GOtv.

The News Agency of Nigeria (NAN) reports that the CCPT had, on 29 April, restrained MultiChoice from increasing its tariffs and cost of products and services scheduled to begin on 1 May.

Mr Onifade, a lawyer and subscriber, had approached the tribunal contending that the eight-day notice given by Multichoice for a price hike was insufficient.

Respondents in the case were MultiChoice and the Federal Competition and Consumer Protection Commission (FCCPC).

He urged the tribunal to restrain Multichoice from implementing the tariff hike from 1 May as planned, pending the hearing determination of the petition.

The tribunal granted the ex-parte motion of the applicant and stopped Multichoice from going ahead with the price increase in the interim.

However, in defiance of the tribunal’s order, MultiChoice hiked its subscription rates for DStv and Gotv packages on the scheduled date 1 May.

Following the price hike, Mr Onifade, on 7 May commenced contempt proceedings against Mohammed Sani, Manager of Abuja office of MultiChoice Nigeria Ltd, over alleged disobedience to the order made by the CCPT.

The Notice of Consequence of Disobedience to Order of Court (Form 48) marked: CCPT/OP/02/2024 filed on 7 May by Mr Onifade warned Mr Sani against disregarding the tribunal order.

MultiChoice, through its lawyer, Moyosore Onigbanjo, a Senior Advocate Nigeria, filed a preliminary objection praying the tribunal to decline jurisdiction in the suit.

Mr Onigbanjo argued that such a price dispute case had been decided before in favour of his client.

Mr Onifade, in his response, urged the tribunal to discountenance the company’s objection and direct it to pay the sum of N10 billion or any amount the panel might deem fit in the circumstance for deliberately disobeying and failure to comply with the interim order.

The lawyer argued that the issue he brought did not border on price regulation or increase.

He explained that what he placed before the court was whether the company gave adequate notice in respect of the 1 May subscription price increase.

“It is our submission that the eight-day notice issued by Multichoice Nigeria Ltd is insufficient in law.

“A monthly subscriber should be given at least a month,” he said, praying the tribunal to dismiss the preliminary objection for being a waste of time of the court.

Delivering the ruling, the Thomas Okosun-led tribunal agreed with Mr Onifade’s submission, prompting the panel to affirm its jurisdiction and rule against the company.

The tribunal subsequently fixed July 3 for hearing of the substantive suit of the claimant.

Premium Times

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Warner Music to Expand Into Lagos, Nigeria

Warner Music Africa (WMA) is planning to establish a new creative hub in Lagos, Nigeria.

The move will mark the opening of Warner’s first fully-owned office in the market. WMA says that its expansion into Lagos will enable it “to provide more of its A&R, Operations and Marketing expertise to Nigeria’s creative ecosystem”.

WMA’s plans to expand in Nigeria arrive at a time of significant recorded music industry growth in the wider Sub-Saharan Africa (SSA) region.

According to IFPI, Sub-Saharan Africa (SSA) was the fastest-growing music region in 2023. It was also the fastest-growing music region globally in 2022.

Recorded music revenues in Sub-Saharan Africa grew by 24.7% in 2023, fuelled, according to IFPI, by a 24.5% rise in paid streaming revenues.

Ahead of the opening of its new office in Lagos, Warner Music Africa’s management team, including Alfonso Perez-Soto, President of Emerging Markets, Warner Music; Laverne Thomas, Operations Lead, WMA; Temi Adeniji, Managing Director, WMA, and Yoel Kenan, CEO, Africori, met with government officials in Nigeria’s capital, Abuja last week.

According to Warner Music Group, this “pivotal journey” saw the executives engage in meetings with key government officials to “establish crucial relationships and to bolster WMA’s mission of empowering Nigeria’s vibrant creative sector”.

During the Warner executive team’s visit last week, they met two senior ministers and the Special Advisor to the President of Nigeria.

Amongst them were: Minister Ayodele Olawande, Nigeria’s Minister of State For Youth Development, who provides insights into youth empowerment initiatives and holds a crucial role in the creative sector for national development. They also met with Minister Hannatu Musawa, the country’s Minister for Art, Culture, and the Creative Economy, and a prominent Nigerian lawyer and politician.

The WMG team also met with Adeagbo (Oluwadunsin) Ayomide, the Special Advisor to the President on Arts, Culture and the Creative Economy.

WMG says that its meetings in Nigeria underscore its “longstanding commitment” to the market.

In 2019, Warner Music Group invested in independent Nigeria-based music company Chocolate City in a deal that WMG said at the time will “dramatically grow the reach of African artists around the world, and will create new opportunities for global superstars in the region”.

In 2022, Warner Music Group acquired a majority stake in Africori, a prominent African music distribution, music rights management and artist development company which has offices in Johannesburg, London and Lagos.

WMG first invested in Africori in early 2020. The original deal gave WMG access to what it called “Africa’s largest catalog and A&R network”, as well as enabling WMG to establish a presence in many African markets for the first time. WMG’s publishing division, Warner Chappell Music, also inked a global deal with Africori in 2020.

In addition, the Warner Music Group / Blavatnik Family Foundation Social Justice Fund (WMG/BFF SJF) has contributed more than USD $400,000 to Nigeria’s creative sector via its Repertoire and Core Funds.

For example, it contributed $200,000 in 2022 to the West African Vocational Education and $150,000 in 2023 to The Sarz Academy which nurtures emerging talent in music production.

Meanwhile, WMG noted on Wednesday (May 22) that Temi Adeniji and Alfonso Perez-Soto’s leadership “has been instrumental in driving the success of Warner Music’s global artists in Africa and their local repertoire across the globe”.

According to WMG, they have played “a pivotal role” in signing and promoting superstar Nigerian artist CKay, whose viral single Love Nwantiti has achieved significant success, recently being certified 8x platinum in the US.

Additionally, WMA recently signed 26-year-old Nigerian singer-songwriter Joeboy, who has amassed 2 billion streams over the past five years.

As part of the deal, Joeboy has created his own record label, Young Legend which will partner with Warner Music Africa for global distribution of its artists’ music.

Earlier this week, Temi Adeniji, Managing Director at Warner Music Africa and Warner’s SVP of Sub-Saharan Africa, joined the MBW podcast to discuss the rise of music from Africa and more.

By Murray Stassen, MUSIC BUSINESS WORLDWIDE

Video - Business returning to normal for Nigeria rice millers following lifting of sanctions with Niger

According to rice millers, prices of paddy rice have dropped by almost a third since March as cross-border trade rises between Nigeria and Niger.

CGTN

Stranded cargo shows credit challenges at Dangote refinery in Nigeria

Chinese state energy major PetroChina has been waiting to unload a cargo of U.S. crude at Nigeria's giant new refinery for nearly a month due to payment issues, according to four trading sources and shipping data.

The impasse highlights difficulties the $20 billion plant funded by Africa's richest man Aliko Dangote faces in its aim to be the biggest refinery on the continent and in Europe when it reaches full capacity this or next year.

Dangote aims to reverse the trend by which the oil-rich country exports its crude but almost totally relies on imports of fuel and other refined products.

The 2-million-barrel West Texas Intermediate (WTI) crude cargo shipped by PetroChina onboard supertanker Maran Mira has, however, been floating off Nigeria since March 28, shipping data on LSEG and Kpler showed.

The completion of the oil sale from PetroChina to Dangote has been delayed as the refinery has yet to issue a letter of credit to the Chinese trader, one source familiar with the matter said.

A letter of credit is the most common form of trade finance. A buyer's bank sends a letter to the seller's bank guaranteeing payment to the seller once goods arrive.

PetroChina was also not keen to receive oil products as payment, one of the ways that Dangote has been paying for its crude, the source said.

Two of the sources also told Reuters that the refinery has had difficulty accessing dollars through the Nigerian government, with the naira's slide against the U.S. dollar as global oil prices have risen straining Nigeria's finances.

The government did not immediately respond to a request for comment and a Dangote executive did not directly address the issue in comments to Reuters.

PetroChina has another 2 million barrels of WTI crude onboard supertanker Kondor that is making its way to Nigeria, according to another source and LSEG shiptracking data.

Potential sellers of U.S. WTI crude to Dangote have been confronted with difficult payment terms: either a 60 to 90 credit or an exchange of refined products for the crude oil, three of the sources said. Credit terms for oil deals are typically 30 days.

PetroChina did not respond to a Reuters request for comment.

A shipbroker estimated that the ship is incurring demurrage costs of around $65,000 a day.

Dangote group executive Edwin Devakumar told Reuters that seeking favourable sale prices and credit terms were normal business practices.

"If someone gives me one year credit, I'll grab it and if not, I'll negotiate the best possible deal," he said. "When you go to a shop to buy something ... You'll try the best possible deal and I do the same".

"We are not delayed. If someone's business is delayed, he is not giving us a good deal," Devakumar said, without specifically addressing the issue with PetroChina.

RAMPING UP

The refinery started operations in January and has reached half its capacity in recent weeks but a further increase is being slowed by its need to borrow billions of dollars in working capital to be able to buy large volumes of crude, trading sources said.

Devakumar declined to comment on the current run rates at the refinery.

The facility is importing around 10 crude oil cargoes a month, two traders said, roughly half the capacity of 650,000 barrels per day (bpd) it seeks to reach this year or next, which would make it the largest refinery in Africa and Europe.

The amount of Nigerian and U.S. crude discharged at Dangote totalled 8.4 million barrels in March and 5.4 million barrels so far in April, Kpler data showed. Another 1 million barrels of Nigerian crude is expected to arrive on April 27.

Trafigura, Mercuria, Vitol, Shell and NNPC were among Dangote's suppliers of crude last month, according to Kpler. 

By Florence Tan, Reuters 

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Dangote refinery supplies petroleum products to local market in Nigeria

Analysts skeptical about improvement of local crude refining in Nigeria

Nigeria has been Africa’s largest or second-largest oil exporter for years, but relies heavily on imports to meet local energy needs. The government is trying to change that, saying the country’s four moribund oil refineries will be revived and put back in operation.

This week, authorities also announced a new policy that oil producers must sell a share of their crude oil to local refiners before they are permitted to export crude.

Nigeria’s petroleum regulatory commission announced the new Domestic Crude Oil Supply Obligation (DCSO) during a meeting with industry players. It's part of an amendment to Nigeria’s Petroleum Industry Act of 2021.

Under the policy, Nigerian oil producers are allowed to export crude only after meeting their supply obligations to local refiners.

The measure will take effect in the second half of the year, but it does not specify what quantity of crude must be supplied to local refineries.

Authorities said the objectives of the guideline are to bolster Nigeria’s refining capacity, improve the oil industry and earn foreign exchange.

Public affairs analyst Jaye Gaskiya said it was the right move. "In the current situation globally, this is actually going to turn out much more beneficial to both the producers and refiners in the country," Gaskiya said. "Essentially this is designed to ease the problem of supply to the local refineries so that they don't become redundant. The second thing is that it is also designed in such a manner to ease the pressure on the naira," which is the currency of Nigeria.

According to the regulations, payments for crude to domestic refiners can be made in dollars, naira or a combination of both.

Nigeria relies heavily on imports to meet the population’s energy needs. Analysts say refining crude oil locally could reverse this trend.

But oil and gas analyst Toyin Akinosho said he had concerns.

"In principle, I do not have a problem with it, but we need to be very careful about the foreign exchange implications and also the volumes that are going out," he said. "My challenge has always been, if you are overzealous about certain regulations, you can burn your fingers. In an era of very low forex [currency trading] and this being the major avenue for inflow into the country, you have to find a way of managing it."

The new measure includes penalties for oil producers who divert crude oil or refiners who fail to meet payment obligations.

But Gaskiya said there were some loose strings to the rule.

"The regulation says it is on the basis of willing buyer and willing seller, and that's quite tricky," Gaskiya said. "A situation where you have the suppliers, for instance, being unwilling, what are you then going to do as the regulator? So those are the things that the regulator needs to be on the lookout for."

The refineries in Nigeria, including the latest one built by Africa's richest man, Aliko Dangote, will have a combined processing capacity of 650,000 barrels of crude oil per day when rehabilitated.

While experts have doubts the new guidelines will be effective, authorities are optimistic Nigeria is getting closer to its goal of having a self-sufficient energy sector.

By Timothy Obiezu, VOA 

Related story: Dangote refinery supplies petroleum products to local market in Nigeria

Libya overtakes Nigeria as Africa's largest oil producer

Heineken Shuts Down Two Plants in Nigeria

Beer-manufacturer Nigerian Breweries will shut down two of its nine manufacturing plants in Nigeria due to the harsh economic situation in the country, the company said in a note to the Nigerian Exchange Limited on Thursday.

Police makers at the company deemed the decision necessary due to operational concerns which was massively impacted by record foreign exchange loss up to the tune of N153.3 billion last year.

It’s the Nigerian subsidiary of Heineken Brouwerijen B.V’s highest foreign exchange loss in the company’s history since it began operations in Nigeria 77 years ago.

The company said it recognised how the closure of the two plants would affect workers in the affected locations. But he said the company was committed to reduce the effect of the situation by providing severance packages to the affected employees.

“We recognise and regret the impact that the suspension of brewery operations in the two affected locations may have on our employees,” said Hans Essaadi, the managing director of the company.

He added, “We are committed to limiting the impact on people as far as possible and providing strong support and severance packages to all affected.”

The decision will help the company to retain 15 per cent capacity expansion over the past decade as well as reduce costs of production, Bloomberg Africa reported.

By Victor Olorunfemi, Peoples Gazette

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Libya overtakes Nigeria as Africa's largest oil producer

Libya overtook Nigeria as the top African crude oil producer for March, data from the Organization of Petroleum Exporting Countries (OPEC) has shown. According to the April 2024 Monthly Oil Market Report (MOMR), Libya recorded 1.236 million barrels per day (bpd) of crude production in March, up from 1.173 million bpd in February.

Meanwhile, Nigeria recorded an output of 1.23 million barrels per day in March 2024, compared to 1.32 bpd in February 2024. Despite the drop in output by 6.8 per cent, Nigeria retained its leadership position on the continent, producing 1.398 million bpd, while Libya produced 1.161 million bpd during the period.

“According to secondary sources, total OPEC-12 crude oil production averaged 26.60 mb/d in March 2024, 3 tb/d higher, m-o-m. Crude oil output increased mainly in IR Iran, Saudi Arabia, Gabon, and Kuwait, while production in Nigeria, Iraq, and Venezuela decreased.”

According to direct communications from OPEC, the recent drop in the country’s crude production can be attributed to a surge in pipeline vandalism and crude oil theft incidents in its oil-producing region.

Experts weighed in, saying that this has led to a decline in business activity and subdued consumer spending, high input-cost inflation, and lower employment levels compared with the previous year.

In other news, the Dangote oil refinery in Nigeria has started supplying petroleum products to the local market, a major step in the country's journey towards energy self-sufficiency. Devakumar Edwin, an executive at Dangote Group, confirmed the arrival of diesel and jet fuel shipments in the local market.

Abubakar Maigandi, head of the Independent Petroleum Marketers Association of Nigeria, also said that local oil marketers reached an agreement on the price of diesel at 1,225 naira ($0.96) per litre following a bulk purchase deal. Maigandi noted that the association's members oversee about 150,000 retail stations throughout Nigeria. 

By Victor Oluwole, Business Insider Africa

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Video - Nigeria advocates for increased patronage of locally manufactured goods

In a bid to alleviate the country's over-dependence on imports, which has contributed to the devaluation of the Naira against the U.S. dollar, the Nigerian government is championing the consumption of domestically produced goods. However, this initiative faces challenges, with the Manufacturers Association of Nigeria citing the closure of over 700 companies and distress among 300 others due to various hurdles. 

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Video - Stock Exchange of Nigeria acquires stake in Ethiopia Securities Exchange

NGX, based in Lagos, and other institutional investors poured large sums of cash into the Ethiopian exchange during its recent capital-raising endeavor. This strategic move aligns with NGX's objectives to expand capital market activities in East Africa and foster cross-border investment flows across the continent.

CGTN

NNPC faces $3 billion backlog on petrol payments

Nigeria's state-oil company NNPC owes around $3 billion to fuel traders for imported petrol, three sources told Reuters, as the tumbling naira currency and rising global fuel prices have increased the effective subsidy it is paying.

The payment backlog is a blow to the government's efforts in Africa's largest economy to shore up its strained finances by curbing costly energy subsidies.

"They are paying, but it's slow," one of the sources with knowledge of the matter said. Five sources said that NNPC - the country's main importer of petrol - was taking more than 130 days to make the payments instead of within 90 days.

An NNPC spokesperson said the company was "not aware of any such debt nor any financial issues of such magnitude".

"Our focus remains on sustaining sufficiency in the supply of petroleum products in Nigeria," the spokesperson said.

NNPC's suppliers, including international traders like Vitol, Mercuria and Gunvor as well as Nigeria-based trading houses, are still supplying fuel, the sources said. They declined to be named because they are not authorised to speak to the media. The trading firms declined to comment.

But the payment delays underscore the creeping return of fuel subsidies - scrapped in May 2023 - that sap NNPC's cash for imports and what it can send to President Bola Tinubu's government.

Nigeria had subsidised fuel for years to keep pump prices affordable, but Tinubu removed them as part of wider reforms, allowing prices to triple. Petrol consumption fell by around 30% as higher prices curbed smuggling to neighbouring countries.

In June, the government capped pump prices at a nationwide average of 617 naira per litre as Nigerians grappled with punishing inflation.

"It's hard to overstate the significance of fuel subsidies for the administration," said Clementine Wallop, director for sub-Saharan Africa at political risk consultancy Horizon Engage.

"It was subsidy removal and exchange rate reform that had investors and lenders initially positive about his administration, and it was their removal Tinubu hoped would give his team the ability to spend in the many other areas that need funding."

Nigeria is almost wholly reliant on fuel imports due to years of mismanagement and under-investment at state-owned oil refineries.

QUEUES AND BACKLOG OF BILLS

Last week, motorists queued for petrol across Nigeria's commercial capital Lagos, due to a shortage of fuel from depots. Clement Isong, head of the Major Oil Marketers Association (MOMAN), said logistical issues over Easter caused the constraints, which would soon abate.

Oil industry sources said rising global gasoline prices and a weaker naira had also impacted NNPC's ability to import.

At their peak in February, market prices for petrol in West Africa were 1,229 naira per litre, 150% above the level the government capped prices in June, according to pricing data from Argus Media converted with tracking site Aboxifx naira rates. They have since fallen to around 912 naira per litre, still 295 naira above the capped price.

That left NNPC as the sole importer of the roughly 40 million litres per day the country consumes, as private importers cannot recoup their costs.

Since the naira has slid against the dollar and oil prices have risen, NNPC is losing money on every litre sold, traders said.

The International Monetary Fund recently warned that capping pump prices and electricity tariffs below cost recovery could shave up to 3% off GDP in 2024.

"The government still needs to begin formulating a plan to remove the fuel subsidy when conditions allow," Tellimer's Patrick Curran said in a note. 

By Libby George and Julia Payne, Reuters

Dangote refinery supplies petroleum products to local market in Nigeria

Nigeria's Dangote oil refinery started supplying petroleum products to the local market on Tuesday, a company executive and fuel marketing associations said, a major step in the country's quest for energy independence.

The refinery, Africa's largest, was built on a peninsula on the outskirts of the commercial capital Lagos at a cost of $20 billion by the continent's richest man Aliko Dangote and was completed after several years of delays.

It can refine up to 650,000 barrels per day (bpd) and will be the largest in Africa and Europe when it reaches full capacity this or next year.

Dangote's group executive, Devakumar Edwin, confirmed shipping of diesel and jet fuel into the local market.

"We have substantial quantities. Products are being evacuated both by sea and road. Ships are lining up one after another to load diesel and aviation jet fuel," Edwin told Reuters.

"Ships load a minimum of 26 million litres, though we try to push for 37 million litres vessels, for ease of operations."

Local oil marketers agreed a price of 1,225 naira ($0.96) per litre of diesel following a bulk purchase agreement, before putting their mark-up, said Abubakar Maigandi, head of the Independent Petroleum Marketers Association of Nigeria.

The association's members control about 150,000 retail stations across Nigeria, Maigandi said.
Another marketers' group, the Depots and Petroleum Products Marketers Association of Nigeria said its members were seeking letters of credit to buy petroleum products from Dangote.

"Our members are discussing with banks and these talks have reached advanced stages, when we have our letters of credit, we will begin lifting products," Femi Adewole, the association's executive secretary said.

The Dangote refinery is touted as the turning point to end Nigeria's reliance on imported petroleum products. Nigeria is Africa's most populous nation and its top oil producer, yet it imports almost all its fuel due to lack of refining capacity. 

By Isaac Anyaogu, Reuters 

Related story: Video - Dangote refinery in Nigeria to import crude from U.S.

 

Video - Nigeria manufacturing sector braces for higher production cost

The decision by Nigeria’s central bank to raise the policy rate affected the local manufacturing industry. Manufacturers said expensive credit will weaken the sector and impede economic growth. Annual inflation in the West African country is at over 30 percent, levels last seen in 1996. 

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Video - Manufacturing firms reporting challenges in Nigeria

Nigeria’s manufacturing sector continues to report sluggish growth, as more factories either shut down or become severely distressed. Analysts say their most pressing concerns include the country's poor infrastructure and difficulties getting access to foreign exchange to buy raw materials.

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According to data released by the National Bureau of Statistics, Nigeria registered a significant increase in used-vehicle imports last year. However, dealers say the growth could be even stronger if not for a crippling cost-of-living crisis and falling local currency.

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Video - Dangote refinery in Nigeria to import crude from U.S.

The announcement comes as the Dangote refinery intensifies moves to start pumping out refined products. The facility is targeting an initial processing rate of 350,000 barrels a day before ramping up toward its full capacity.

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Dangote oil refinery to help solve fuel shortage in Nigeria

 

 

Dangote wants to set up trading arm for Lagos mega refinery

Africa's richest man Aliko Dangote is planning to set up an oil trading arm, likely based in London, to help run crude and products supply for his new refinery in Nigeria, six sources familiar with the matter said.

The move would reduce the role of the world's biggest trading firms, which have been negotiating for months to provide the refinery with financing and crude oil in exchange for products exports. The giant 650,000 barrel-per-day refinery is set to redraw global oil and fuel flows and the trading community is closely watching the way it will operate.

Dangote, whose wealth is estimated by Forbes at $12.7 billion, did not reply to several comment requests.
BP, Trafigura and Vitol among others have met Dangote in Lagos and London in recent weeks to offer loans for the some $3 billion in working capital the refinery needs to buy large amounts of crude, trading sources told Reuters.

The traders asked the refinery to repay loans with fuel exports but so far they have signed no deals as Dangote worries they would reduce his control of the project – and potentially his profit, the sources said. Dangote has also met state-backed firms in his search for cash and crude.

"He is going to try and do it himself," an industry source told Reuters. Sources told Reuters the new trading team will be led by ex-Essar trader Radha Mohan. He joined Dangote in 2021 as director of international supply and trading, according to his Linkedin profile. Two sources said the team was in the process of hiring two new traders.

The refinery took nearly a decade to complete -- and came in at a cost of $20 billion, some $6 billion over budget.

The plant has refined around 8 million barrels of oil between January and February and will take months to get to full capacity. So far, Vitol has prepaid for some product cargoes to help the refinery buy crude, while Trafigura has swapped some crude oil in exchange for future fuel cargoes, sources with knowledge said. Geneva-based Vitol and Trafigura declined to comment. 

By Julia Payne and Libby George, Reuters 

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