Dangote Refinery Owes N7.9 Trillion Despite Slashing $570m Debt Ahead of Mega IPO — Documents

LAGOS — The Dangote Petroleum Refinery and Petrochemicals still owes a staggering N7.9 trillion ($5.67 billion), even after cutting its secured debt by about N798 billion ($570 million) in the first half of 2026, documents from its IPO prospectus have revealed.

The refinery, now operating at full 700,000 barrels-per-day capacity, is ramping up production and cash flow ahead of its highly anticipated Initial Public Offering (IPO) slated to open on September 14.

—Debt Down, But Still Massive—

According to the prospectus, total debt dropped from *$6.24 billion* at the end of December 2025 to $5.67 billion by June 30, 2026 — a reduction of $570 million, equivalent to about N798 billion at N1,400/$.

The company says stronger sales and refining margins have improved its financial position, with its net debt-to-EBITDA ratio at 0.27x as of June, expected to fall further as operations stabilize.

—Dangote Still In Total Control After IPO—

The refinery plans to offer 4.1 billion new shares at N525 each in the IPO.

But Africa’s richest man, Aliko Dangote, will remain firmly in control. His beneficial ownership — currently 87.27% through Dangote Oil Refining Company Limited (DORCL), Dangote Industries Limited (DIL), Greenview International Corporation and Salamad Ventures — will only dip marginally to 84.34% even if the offer is fully subscribed.

Current shareholding structure:

– DORCL: 65.835%
– DIL: 14.904%
– NNPC Limited: 6.815%* (to dilute to ∼6.59% post-IPO)
– Greenview: 6.496%
– Others: 5.950%

The IPO is via issuance of new shares, not a sell-down, underscoring Dangote’s stated goal of widening participation without relinquishing control.

Speaking in Lagos after an IPO signing event, Dangote said the offer is not primarily to raise cash, noting the refinery has strong cash generation and has already tapped bonds and private placements. He disclosed that strategic investors, including Abu Dhabi National Oil Company (ADNOC), have shown interest, but declined details due to NDAs.

—War Boom: Refinery Maximising Diesel For Europe—

The refinery is cashing in on global market disruptions caused by the US-Iran conflict*.

CEO David Bird said the facility is “running flat out” at 700,000bpd and maximising *diesel and aviation fuel* for the European market, where Middle East supplies have been disrupted.

“Right now we’re very much maximising our diesel, but the jet is still extremely significant from a yield perspective,” Bird said.

Bloomberg reports diesel premium over crude has hit a 15-year high, making Dangote’s flexibility highly lucrative. Bird said the company remains “extremely bullish” on margins medium-term.

Dangote, however, insists long-term projections are based on “normal days,” not war profits.

—Kenya Refinery Gamble Faces Crude Headache—

Meanwhile, Dangote’s proposed $15-16 billion, 700,000bpd refinery in Lamu, Kenya — scheduled for groundbreaking later this month for completion in 2030 — is facing serious questions.

Reuters reports Kenya has no commercial-scale oil production, Uganda’s crude flows via EACOP to Tanzania, and South Sudan’s exports through Sudan are disrupted by insecurity. A proposed South Sudan-Kenya pipeline to Lamu remains distant.

Lagos-based oil lawyer Maximillian Ezeude warned the coastal facility may be left dependent on a “volatile international seaborne market.”

Oxford Economics Senior Economist Brendon Verster warned it could become “a very expensive white elephant” if feedstock, storage and port infrastructure challenges are not resolved. The Lamu site also faces environmental opposition, being just 10km from Lamu Old Town, a UNESCO World Heritage site.

Kenyan authorities, however, back the project to cut its $4 billion annual fuel import bill.

—Oil Crosses $100 On US-Iran Escalation—

The financial disclosures came as Brent crude breached $100/barrel yesterday for the first time in months, following US military strikes that destroyed five Iranian tankers — Kivik, Charminar, Horizon 1, Riesco and Derya — after an attempted Iranian missile attack on a US warship near the Strait of Hormuz, through which a fifth of global oil passes.

WTI traded around $95, with Brent up ∼40% since the conflict began.

[Culled from THISDAY]