Dangote Fertiliser Limited has begun countdown to the inauguration of its $2 billion Granulated Urea Fertiliser complex located in the Dangote Free Zone.
With a capacity of 3 million tonnes per annum, the plant has been classified as the biggest project in the entire fertiliser industry history in the World. Siapem of Italy is the Engineering, Procurement and Supervision (EP) Contractor for the project, while Tata Consulting Engineers, India, is the Project Management Consultants (PMC) for the project.
At this time, several critical sections of the plant are going through various stages of pre-commissioning and test-run. Virtually all the section of the plant such as Central Control Room, Ammonia and Urea Bulk Storage, Cooling Tower, Power Generator Plant, Granulation Plant, have all been completed and are going through pre-testing.
Already, Dangote Feritiser has started receiving gas supply from the Nigerian Gas Company and Chevron Nigeria Limited under the Gas Sale and Purchase was Agreement to supply 70 million standard cubic feet per day (Scf/d) of natural gas to Dangote Fertiliser Limited.
The project, which will create thousands of direct and indirect jobs in construction and related fields, will provide a major boost to the agricultural sector by significantly reducing the importation of fertiliser in Nigeria and ultimately removing the need for imports when plant is in full production.
Group Executive Director, Strategy, Portfolio Development & Capital Projects, Dangote Industries Limited, Devakumar Edwin said Nigeria will be able to save $0.5billion from import substitution and provide $0.4 billion from exports of products from the fertiliser plant. “Thus, the supply of fertiliser from the plant, will be enough for the Nigerian market and neighbouring countries,” he said.
Edwin said: “I am happy that by the time our plant is fully commissioned, the country will become self sufficient in fertiliser production and even have the capacity to export the products to other African countries. Right now, farmers are forced to utilise whatever fertiliser that is available as they have no choice, but we need to know that the fertiliser that will work in one State may not be suitable in another State, as they may not have the same soil type and composition. The same fertiliser you use for sorghum may not be the fertiliser you will use for sugar cane.”
He stated that the Dangote fertiliser project, which is estimated to gulp $2billion is the largest granulated Urea fertiliser complex to emerge in the entire fertiliser industry history in the world, with its three million tonnes per annum capacity.
He pointed out that the fertiliser complex, which is sited on 500 hectares of land has the capacity to expand as it is only occupying a small fraction of the allotted portion.
Edwin added: “The management of the complex are confident that the fertiliser business will deliver reasonable profit to the company and its shareholders as it is projected that population growth and the need for food production will jack up the consumption of Urea fertiliser beginning from 2020 when production of the production would have commenced in earnest.
“The current consumption of Urea estimated at a dismal 700,000 tonnes per annum by Nigerian farmers is said to be due to very poor usage and is believed to be the cause of poor product yield, which threatens food security in the country.
“By 2020, Nigerian population is projected to increase to about 207 million which would lead to increased food production. Estimates points out that around five million tonnes of fertilisers are required per year in Nigeria in the next five to seven years bifurcated into 3.5 million tonnes of Urea and 1.5 million tonnes of NPK while current production levels in Nigeria are at 1.6 million tonnes by 2019.”
AfDB urges central banks to cut interest rates
The African Development Bank (AfDB) has urged central banks on the continent to act quickly by cutting interest rates to inject liquidity in view of impact of COVID-19 pandemic.
The AfDB , in its African Economic Outlook 2020 supplement amid coronavirus pandemic released on Tuesday gave the advice.
According to the bank, the targeted interventions should be implemented for affected firms and sectors and use macroprudential and unconventional monetary policy to support the economy.
It added that central banks could resort to their own forms of quantitative easing, targeted at funding the most affected sectors such as firms in the hospitality and entertainment industry.
The bank noted that other sectors to be assisted are airlines, hotel chains, logistics and sports by temporarily reprofiling or restructuring their debts.
AfDB emphasised that the apex banks could also support vulnerable groups by designing programmes targeted at micro enterprises and the unbanked in the informal sector, financed by government and potentially run by other agencies closer to the ground.
“The impact of COVID–19 on Africa’s labour markets will have disproportionate impacts on vulnerable groups, notably youth and women, who are engaged in the informal sector, or with only casual job opportunities in the formal sector.
“Assist vulnerable groups, especially youth and women. The COVID–19 pandemic can have differentiated socioeconomic impacts,” the AfDB said.
BUA set to establish ultramodern 3million metric tonnes cement plant, 50mw power plant in Adamawa
One of West Africa’s largest Cement companies, BUA Cement has announced that it is set to establish a three million metric tonnes cement plant and 50 megawatts power plant in Guyuk and Lamurde local governments of Adamawa state in the North Easter region of Nigeria. This was revealed when the Chairman of BUA, Abdul Samad Rabiu led the BUA Cement Management team on a courtesy call to the Adamawa State Governor, Ahmadu Umaru Fintiri in the Government House, Yola.
Speaking during the visit, Abdul Samad Rabiu said preliminary findings show that the two local governments of Guyuk and Lamurde are reputed to have good quality of limestone deposits and BUA Cement is ready to begin the investment in the state. He added that the BUA will use new technologies to supply power to the proposed cement plant and communities of Guyuk and Lamurde in addition to providing three thousand direct and five thousand indirect jobs.
The Chairman stressed that the Guyuk Cement Plant will be the major investment in the North East by BUA and solicited for support of Governor Umaru Fintiri to set up the factory in Guyuk. Rabiu said the company made a decision to source its raw materials locally and it has invested billions of dollars in various sectors across Nigeria and therefore urged the state government to support BUA to actualize the Guyuk Cement project. In addition, he praised the commitment of the governor within one year in office in many sectors of development despite the economic challenges in Adamawa.
Responding, Governor Ahmadu Umaru Fintiri said his administration’s effort in exploring local contents has started yielding results and thanked BUA for showing interest in establishing the cement plant in Guyuk. He further assured the management team of BUA that government will make whatever is needed and provide the necessary support which will create enabling environment so that the BUA Cement company in Guyuk will become a reality.
He also expressed readiness of the government to protect the investment once it is established and told them that his administration will maintain the good relationship with the company for the benefit of the state.
BUA is Nigeria’s second largest Cement Producer by volume with cement plants in Sokoto and Edo States. The Company’s newest plant in Sokoto is expected to be operational in 2021. When completed, the Guyuk Cement Plant will bring BUA’s total capacity to 14million metric tonnes per annum.
Dangote cement sustains 54,000 jobs in 4 African countries
President of Dangote Group, Alhaji Aliko Dangote has said that despite the challenging economic situation in 2019, Dangote Cement was able to sustain 54,000 jobs in four African countries, where the company has its operations. The countries are Nigeria, Ethiopia, Senegal and South Africa.
The business mogul who disclosed this to shareholders at the company’s 11th Annual General Meeting in Lagos said that more jobs would be created as the company intensifies the export of clinker to other neighboring countries from Nigeria.
“According to our 2019 socio-economic impact assessment study specifically on our operations in Nigeria, Ethiopia, Senegal, and South Africa, we sustained 54,005 jobs (direct, indirect, induced) in these four markets in the year under review,” he said.
Dangote told the shareholders that the year 2019 was a strong year given the tough business environment across most of its operating geographics, disclosing that the group recorded volumes of 23.7 million metric tons and revenues of ₦891.7 billion.
He said: “We recorded a strong EBITDA margin of 44.3 percent. As a result of this performance, the board has recommended for your approval a dividend of ₦16.00 per ordinary 50 kobo share.”
Speaking on the local Nigerian operations, he said: “Nigeria’s cement market grew slightly in 2019. We estimate that total market consumption was up between 2 per cent-3 percent on the 20.7Mt estimated in 2018.”
Dangote explained that the modest performance was in spite of the fact that the market generally was impacted negatively by the disruptions related to the 2019 election cycles, heavy rains and the loss in land export volumes due to the border closure.
“Dangote Cement’s Nigerian operations remained at 14.1Mt in 2019, including export sales of 0.45Mt. Domestic sales in Nigeria were nearly 13.7Mt, compared to 13.4Mt in 2019. This implies a 2 percent growth mirroring the estimated GDP growth for the year. However, land exports reduced to 0.45Mt from 0.7Mt for the full year owing to the border closure in the last few months of 2019.
“The Bag of Goodies promotion, launched in July, drove strong increases in our Nigerian volumes in the third quarter”, Dangote pointed out, adding that the innovative marketing effort enabled the company to maintain its market share despite the 4.5Mt new capacity which came into the market during the year.”
He alluded to the new feat by Dangote Cement in commencing export of clinker via shipping from the Apapa and Onne ports to West and Central Africa, adding that the management was encouraged by the performance of its offshore operations.
Recall that the Governor of Central Bank of Nigeria (CBN), Godwin Emefiele, while lauding the investment drive of Dangote recently said that he was excited with the progress made at Dangote Refinery and Petrochemical plant so far, said that when it becomes operational, the refinery and petrochemical plant would increase its workforce from the current 34,000 to over 70,000.
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