TheCable

The federal executive council (FEC) has approved the sum of $2.76 billion for the acquisition of a 20 percent minority equity stake in the Dangote Refinery.

Timipre Sylva, minister of state for petroleum resources, announced this at the end of the weekly FEC meeting in Abuja on Wednesday.

The Dangote Refinery is a 650,000 barrels per day integrated refinery project under construction in the Lekki Free Zone, Lagos. It is expected to be Africa’s biggest oil refinery and the world’s biggest single-train facility, upon completion.

He said the FEC also approved the sum of $1.48 billion for the rehabilitation of both Warri and Kaduna refineries.

“The Executive Council also approved the acquisition of 20% minority stakes by the NNPC in Dangote Petroleum and petrochemical refinery in the sum of $2.76 billion,” Sylva said.

The Nigerian National Petroleum Corporation (NNPC) had announced plans to seek equity participation in at least six private refinery projects.

In June, Mele Kyari, group managing director of NNPC, confirmed that the federal government would acquire a 20 percent equity stake in the Dangote Refinery.

He said NNPC would borrow to acquire the equity stake in order to yield results and dividends for Nigeria instead of using funds from the federation.

The corporation said to be discussing with African Export-Import Bank (Afreximbank) for a loan to acquire the stake.

Last month, Sylva said the federal government decided to acquire equity in private refineries to prevent fuel scarcity.

“Acquiring stakes in Dangote Refinery and other private refineries was a strategic decision by the government to get involved in the running of these important assets and not allow them completely in the hands of private individuals,” he had said.