FG backs Dangote Refinery’s expansion to 1.4m barrels daily — Lokpobiri

The Federal Government has pledged its full support to the Dangote Refinery as it moves to expand its refining capacity to 1.4 million barrels per day, describing the project as a game-changer for Africa’s energy independence and global relevance.

Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, made this known on Monday in Lagos during his welcome address at the 19th Africa Downstream Energy Week, themed “Energy Sustainability: Growth Beyond Boundaries and Competition.”

“I received the good news that the Dangote Refinery is expanding its capacity to 1.4 million barrels per day. That will not just save Nigeria or West Africa, it will save Africa and, indeed, make an impact globally. The Federal Government will support him all the way to accomplishing that goal,” Lokpobiri stated.

He described the refinery’s expansion plan as a milestone that validates President Bola Ahmed Tinubu’s policy direction toward energy self-sufficiency.

According to the minister, the removal of fuel subsidy and the liberalisation of the downstream petroleum sector were deliberate policy choices aimed at attracting private investment and stimulating growth.

“The main reason President Tinubu announced the removal of fuel subsidy on his first day in office was that, with subsidies, the private sector could not grow. The downstream can only thrive when the right business environment allows private capital to flow in, invest, and maximise opportunities,” he explained.

Lokpobiri noted that while the decision initially faced criticism, deregulation had now created a healthier, more competitive market.

“With deregulation and liberalisation, there is now healthy competition. Prices are stable, availability has improved, and products are more accessible and affordable despite challenges,” he said.

The minister stressed that keeping the subsidy regime would have crippled the energy sector, adding that its removal has restored investor confidence and fiscal discipline.

He reaffirmed government’s commitment to deepening investment in oil and gas, noting that global energy transition conversations are increasingly recognising the continued importance of hydrocarbons.

“The world has realised that energy transition cannot happen in a vacuum. Even as we pursue cleaner sources, the global economy still depends on oil and gas. Without substantial investment in these resources, there will be no financial capacity to fund the energy mix we all desire,” Lokpobiri said.

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Citing recent United Nations reports, he disclosed that the world needs about $540 billion annually in oil and gas recovery and related infrastructure investments to meet growing demand and maintain energy security.

He argued that, despite the global shift to renewables, Africa cannot afford to neglect hydrocarbon development.

“Africa, with a population exceeding 1.4 billion people, cannot afford to ignore investment in oil and gas. Expanding exploration, production, and refining capacity is crucial not only for self-sufficiency but also for the continent’s economic stability,” he added.

Lokpobiri further maintained that Nigeria’s downstream sector is gradually stabilising after years of distortion caused by subsidies.

“Subsidy was not sustainable; it discouraged private investment and placed a heavy burden on government finances. What we are seeing today is a more competitive environment that promotes efficiency and private participation,” he said.

He commended President Tinubu for his “bold and courageous decisions,” noting that such leadership is necessary for long-term national growth.

“It takes a courageous leader to make decisions that may be unpopular today but are necessary for the country’s future,” the minister added.

Reiterating government’s broader reform agenda, Lokpobiri said ongoing initiatives are focused on ensuring energy security, promoting domestic refining, and driving private-sector participation across the oil and gas value chain.

“We are no longer just talking about transition; we are building an energy mix that guarantees security for Africa. Every stakeholder must align with this vision to create the Africa we want,” he stated.

Also speaking at the event, Mr. Adetunji Oyebanji, Chairman of the Advisory Board of OTL Africa Downstream Energy Week, called for renewed collaboration, policy consistency, and innovation to drive Africa’s energy sustainability and competitiveness.

Oyebanji said the conference provided a platform for regulators, operators, investors, and innovators to bridge the gap between policy and practice, adding that:

“Energy sustainability is not merely about preserving resources; it is about ensuring that our growth today does not compromise the prosperity of tomorrow. We must build an industry that is competitive, responsible, and adaptable to a rapidly changing global environment.”

The former Chairman of the Major Energy Marketers Association of Nigeria (MEMAN) noted that Africa must shift from being a mere supplier of raw hydrocarbons to becoming a hub for innovation, efficiency, and value addition.

“Africa must position itself not just as a source of energy, but as a source of innovation. Our growth must be sustainable, inclusive, and borderless,” Oyebanji declared.

He stressed that Nigeria remains central to Africa’s energy transformation, given its deregulated downstream market, gas commercialisation drive, and expanding infrastructure.

However, he cautioned that “sustained progress depends on policy stability, regulatory transparency, and institutional consistency,” noting that investors require predictability and confidence to commit long-term capital.

Reflecting on Nigeria’s downstream reforms, Oyebanji said the removal of fuel subsidies and market liberalisation, though challenging, were necessary to build a competitive and innovative sector.

He cited progress in logistics, storage, and digital trading as indicators of renewal in the industry.

“The downstream market is evolving amid both turbulence and transformation. Success will depend on our ability to combine innovation with policy stability and operational efficiency,” Oyebanji said.

He concluded by urging stakeholders to embrace collaboration as a new form of competition:

“Our capacity to grow beyond boundaries depends not only on how hard we compete but on how well we cooperate,” he said, adding that the future of energy lies in integrating hydrocarbons, renewables, and alternative sources for inclusive and sustainable growth.

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