The Dangote refinery has presented many new opportunities and possibilities as well as broken down boundaries in oil production. In his review of “Intelligent Entrepreneur: “How Three Harvard Business School Graduates Learned The Ten Rules of Successful Entrepreneurship” (Henry Holt & Co.) by Bill Murphy, Gilles Bouchard, from Executive Business Accelerator, explains the principles of entrepreneurship for anyone looking to build the spirit of an entrepreneur.
Lessons for young entrepreneurs from Dangote's newly commissioned oil refinery
In a ceremony attended by heads of state, business leaders, and industry players, Nigerian President Muhammadu Buhari on Monday, May 22, 2023, inaugurated Africa’s largest oil refinery. The event is a major milestone for Nigeria and Africa as a whole. In this article, we explore some of the lessons budding entrepreneurs can pick up from this monumental establishment.
Let us look at some of the principles that entrepreneurs can pick from the Dangote refinery.
Principle 1: Making a lot of money quickly is not the first goal of entrepreneurs
The Dangote refinery has been under construction for nearly seven years costing Dangote $19 billion, which is $6 billion more than his net worth ($13.6 billion as of this year).
Principle 2: Find the right opportunity
Although Nigeria has four state refineries, the Dangote Refinery has been described as the world's largest "single-train" refinery facility (meaning it can process multiple products from one unit). It is capable of refining a staggering 650,000 barrels per day compared to the combined production of 445,000 barrels per day by the state refineries.
Being a single-train refinery facility, it has the capacity to meet 100% of Nigeria’s petroleum product demand, including gasoline, diesel, kerosene, and jet fuel.
“Our first goal is to ramp up production to ensure that within this year, we can fully satisfy the nation’s demand for quality petroleum products,” Dangote said at the launch.
Buhari described the refinery as a “game-changer for the Nigerian people.”
Principle 5: Be aware of your impact
According to Bouchard, "Money is important, but in terms of ruling the business. And two things seem to be much more important than money:" he says, adding, "Sharing with others the capacity for seizing the type of opportunities they (entrepreneurs) enjoyed and doing work that has a real impact on people’s lives."
The benefits of Dangote Refinery extend well beyond the provision of refined fuels. The facility, which Dangote says boasts cutting-edge technology and equipment from around the globe, has the following added benefits.
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- It is expected to generate a substantial 435 MW of electricity, alleviating the country’s power shortages.
- It will operate under a public-private model, with the Nigerian National Petroleum Corporation (NNPC) holding a 20% stake and supplying 300,000 bpd of crude oil to the refinery.
Principle 6: Be aware of your social and economic role
"Successful entrepreneurs have a specific mission which is to work for a better world," says Bouchard. "That’s true from several points of view: Economical (raising the standards of living through innovation, contributing to global growth), financial (generating value and prosperity), Organizational (transforming structures and organizations, rejuvenating technologies and competition), employment (creating jobs, changing working habits), and social (fostering collective thinking, cross-cultural exchanges, social mobility, tolerance, open-mindedness)."
The refinery will create over 130,000 job opportunities while injecting an impressive US$10 billion into the Nigerian economy annually.
It will lessen the cost of importing refined petrol which in 2022 took $23 billion out of the Nigerian economy. It will also curb fuel shortages that have in the past brought Nigeria to a standstill.
Beyond its immediate impact on Nigeria, the refinery holds great promise for West Africa and Africa at large by reversing the region’s reliance on external importation. Its importance to the region was emphasised by the presence of heads of state from Ghana, Togo, Niger, and Senegal and a representative from the Republic of Chad at the inauguration.
The refinery boasts 40% export capacity meaning that West Africa will have a nearby option to meet their demands. It also presents the potential for fuel to be traded in local currencies, alleviating the dollar shortages experienced by many African countries. For Nigeria alone, this means eliminating a foreign exchange bill of up to $26 billion.
Moreover, the facility features a state-of-the-art deep seaport with two quays capable of handling 25 tonnes/sq. meter loads, facilitating the export of fertiliser from its fertiliser unit, and more.
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