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Finance - News around Africa - Profiles - February 26, 2020

Dangote Begins Pre-testing of $2BN Fertiliser Plant

Before its planned inauguration, Dangote Fertiliser Limited has announced the commencement of pre-testing works on its $2 billion Granulated Urea Fertiliser plant within the Dangote free port in Ibeju Lekki, Lagos.

 The Dangote fertiliser plant has a capacity of three million tonnes per year and is adjudged the most important project within the fertiliser industry. Saipem of Italy is the Engineering, Procurement and Supervision (EP) Contractor for the project, while Tata Consulting Engineers, India, is that the Project Management Consultants (PMC).

Ahead of the commissioning, several critical sections of the plant are running various stages of pre-commissioning and test-run, while all the sections of the plant, including the central room, ammonia and urea bulk storage, cooling system, power generator plant, granulation plant, have all been completed and are also pre-testing.

Already, the Dangote fertiliser plant has received gas supply from the Nigerian Gas Service and Chevron Nigeria Limited under its earlier signed gas sales purchase contract to provide 70 million standard cubic feet per day (scf/d) of gas per day.

How Dangote Fertiliser Plant Benefits Nigeria

The project, which is targeted at creating thousands of direct and indirect jobs in construction and related fields, will provide a significant boost to the agricultural sector by significantly reducing the importation of fertiliser in Nigeria. The Group Executive, Strategy, Portfolio Development & Capital Projects, Dangote Industries Limited, Devakumar Edwin, said Nigeria is getting set to save $0.5 billion from import substitution and supply $0.4 billion from exports of products from the fertiliser plant. “Thus, the availability of fertiliser from the plant is going to be enough for the Nigerian market and neighbouring countries,” he said.

“I am happy that by the time our plant is fully commissioned, the country will become self-sufficient in fertiliser production and even can export the products to other African countries. 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 three million tonnes per year capacity Dangote fertiliser project, which is estimated to gulp $2billion is the largest granulated Urea fertiliser complex to emerge within the global fertiliser industry. He pointed out that the fertiliser complex, which sits on 500 hectares of land can expand as it is only occupying a small fraction of the allotted portion.

Edwin added, “The management of the complex is confident that the fertiliser business will deliver reasonable profit to the company and its shareholders as it projects 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 started”.

READ ALSO: Dangote Group Explains How It Plans to Tackle Nigeria’s Unemployment Rate

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