Nigeria’s Dangote Group has awarded a $350 million contract to Engineers India Limited to expand its Lekki refinery to 1.4 million barrels per day. The move more than doubles current capacity and supports Dangote’s ambition to position Nigeria as a regional petroleum hub.
The agreement with the Indian state-owned engineering firm will add a second processing train, which would turn the Lekki facility into the world’s largest refinery complex at a single location.
The project will also upgrade fuel production to Euro VI standards and expand polypropylene output threefold to 2.4 million metric tons per year.
Engineers India will act as project manager and engineering consultant, the same role it played on the original 650,000 barrel-per-day refinery that started operations in 2024. Located in the Lekki Free Zone near Lagos, that plant is currently the world’s largest single-train refinery.
The expansion targets Nigeria’s long-standing reliance on imported refined fuels despite being a major crude oil producer. This imbalance has drained foreign exchange reserves and exposed the country to repeated fuel supply disruptions. Nigeria produces about 1.3 million barrels of crude daily but has depended on imports due to non-functional state refineries.
Engineers India described the project as globally significant, noting that it will rank among the largest refinery complexes ever built at a single site. The firm, which operates under India’s Ministry of Petroleum and Natural Gas, has executed projects across oil and gas, petrochemicals, and infrastructure.
The second phase will introduce Euro VI fuel production, meeting stricter emissions standards than the Euro V fuels currently produced. The polypropylene upgrade will involve refurbishing existing units and adding a new 1.2 million metric ton facility, along with a 750,000 metric ton UOP Oleflex unit to supply propylene.
Aliko Dangote, chairman of Dangote Group and Africa’s richest individual, sees the refinery as a cornerstone of Nigeria’s economic shift. The group operates in 17 African countries across industries including cement, sugar, and energy and ranks among West Africa’s largest private employers.
The companies have not disclosed the project’s timeline or financing structure. Engineers India’s scope includes engineering, procurement, construction management, and commissioning until completion.
Nigeria’s government has backed domestic refining as a way to cut fuel imports and stabilize pump prices, a politically sensitive issue. President Bola Tinubu removed fuel subsidies in May 2023, triggering inflation but easing pressure on public finances.
The refinery already produces petrol, diesel, jet fuel, and polypropylene. Analysts say the expansion could reshape regional fuel markets by allowing Nigeria to export refined products to neighboring West African countries that currently rely on Europe.
Engineers India has delivered major energy projects worldwide, including refineries, petrochemical plants, and fertilizer facilities. Its selection reflects the technical challenge of integrating new units into an operating mega-complex.
The original refinery faced delays and startup issues typical of large industrial projects, including equipment testing and feedstock optimization. Company officials now say it is running at full design capacity.
Dangote Group is also pursuing upstream oil and gas projects, fertilizer production at its Lekki complex, and possible expansion into other African markets. The refinery upgrade marks its largest investment since completing the initial phase.
source: businessday.ng
African Energy Council