Dangote Refinery names competition that may adversely impact its performance

Dangote Refinery has identified existing and planned refineries in Nigeria and across Africa, as well as major export-oriented plants in the Middle East and Asia, as potential sources of competitive pressure on its business.

The disclosure was contained in the refinery’s IPO prospectus as the company prepares for its planned listing on the Nigerian Exchange (NGX).

As of June 30, 2026, Dangote Refinery accounted for about 58% of Nigeria’s total installed refining capacity and an estimated 90% or more of the country’s operational capacity, the prospectus noted.

Despite its significant position, the company warned that additional refining capacity could intensify competition in both domestic and international markets.

What the prospectus is saying

The prospectus specifically identified the three NNPC legacy refineries in Port Harcourt, Warri and Kaduna as potential competitors if they return to sustained commercial operations.

The Federal Government has indicated its intention to rehabilitate the facilities, although their operating history has been marked by prolonged underperformance and repeated rehabilitation efforts.

The prospectus warned that the return of the refineries, alongside other new projects, could increase refined petroleum product supply in Dangote Refinery’s target markets.

• “If new or rehabilitated refineries become operational, the supply of refined petroleum products in the Issuer’s target markets could increase,” the company stated.

It added that greater competition could reduce its market share, put downward pressure on product prices or compress refining margins, potentially affecting its business, financial condition and future prospects.

NNPC Ltd has previously acknowledged challenges surrounding its state-owned refineries. In February 2026, the company said internal assessments had shown the facilities were operating at “monumental losses” and destroying national value.

The state-owned refineries had also undergone repeated turnaround maintenance programmes without achieving sustained commercial operations.

• In October 2025, NNPC Ltd commenced a technical and commercial review of the Port Harcourt, Warri and Kaduna facilities to determine their operational and financial viability.
• Beyond Nigeria, Dangote Refinery pointed to the broader African refining market, where approximately 3 million barrels per day of nameplate capacity is installed.
• Several large-scale projects are also at different stages of development or planning, potentially increasing the supply of refined products available to African markets.

The company also faces competition from large export-oriented refineries in the Middle East and Asia for access to international markets, particularly as a substantial portion of its production is exported.

This means Dangote’s competitive position will depend not only on its dominant domestic capacity but also on its ability to remain commercially competitive in export markets.

Get up to speed

The competition disclosure comes as Dangote Refinery prepares for a N2.15 trillion initial public offering approved by the Securities and Exchange Commission (SEC).

The company had previously raised $2.5 billion through a private placement ahead of the IPO, strengthening its balance sheet and financing position.

The IPO opened through about 55 digital channels covering banks, mobile money operators, the NGX Invest platform and fintech companies, with the company targeting a broader retail investor base.

The offer is scheduled to close on October 13, while listing on the NGX is expected in November.

Dangote Refinery’s wider expansion strategy also includes exploring refining opportunities outside Nigeria, including a proposed refinery project in Kenya.

What you should know

In May 2023, Africa’s largest oil refinery, the Dangote Refinery, was commissioned in Nigeria, with hopes that it would help alleviate the country’s chronic fuel shortages.

Aliko Dangote, Chief Executive Officer of Dangote Group, had said investors can subscribe to the proposed IPO of the refinery with a minimum of 10 ordinary shares, worth N5,250.

Dangote Refinery currently holds a dominant position in Nigeria’s refining landscape, but the prospectus notes that this position is not insulated from changes in domestic and international supply.