Why We Moved Our Refinery From Olokola To Lagos – Dangote Reveals

The chairman of Dangote group of companies, Alhaji Aliko Dangote has revealed his reason for relocating the group’s petroleum refinery earlier planned to be situated in Olokola, a boundary community shared between Ondo and Ogun states.

Dangote who spoke while addressing journalists in the refinery complex in Lagos, said continued disagreement between the company and the Amosu led Ogun state government led to the company’s decision to relocate it to Lagos.

He further revealed that the company was losing money paid as interest on the loan secured for the project, while the disagreement last for three and half years.

He added that the biggest problem the company had was the inability to gain access into Olokola plant while the disagreement lasted.

“We signed the loan agreement of this refinery in September 2013. Normally in banks, they don’t lock their own money – once you sign, you must draw down within 90 days.” He said.

“When we signed that loan, the first draw down was 2.65 billion dollars which we took. The bank did not even ask us for the certificate of the land because of the trust they had in Dangote group, even though we had the certificate with us then but we had no access to the land. We didn’t have license because the issue of license dragged for a long time.”

“It was a period the government was begging people to come and get license but some people believed if we get the license, we might succeed in building the refinery, so they withheld the license for a while but we got it finally.”

“The biggest problem we had was Ogun state government where for 3 and half years, we could not gain access into Olokola plant. You know when you are building a complex like this, you need the access to do the soil test and other test for you to even start drawings, you need to know the kind of foundation you want to have.”

“Unfortunately, we couldn’t agree with Ogun state government and that delay cost us over 500 million dollars because we were paying interest on the money (loan) as the 2.65 billion dollars was in an exco account where there was no interest rate at all.”

“From there, we got upset. We now got this land from Lagos state government. For the cement, we have spent 1.7 billion dollars.” He added.

It is worthy of note that the relocation of the refinery has been a subject of controversy in ondo state, which is now finally laid to rest by the latest revelation.