Dangote stakes $7.7bn in Rivers Energy City
FG’s $4 billion investment also coming
Aliko Dangote, president, Dangote Group, has directed his investment gaze in the direction of Rivers State with initial $7.7 billion (N1.2 trillion) stake in the state’s emerging energy city.
Rivers Energy City is part of the mega city concept known as the Greater Port Harcourt City which cuts across eight local councils including Ogu/Bolo, the host council of the energy city.
Dangote has already made open visits, having inspected the large expanse of land beside the waters at Okpokiri in Ogu/Bolo near Okrika Jetty along with the state governor, Chibuike Rotimi Amaechi. The energy city is on the other side of the multi-billion dollar Onne Oil and Gas Free Zone. A bridge is being constructed already to link the free zone and the energy city.
Dangote’s visit was a highlight of the recent Rivers Investors’ Forum which attracted international leaders and investors including immediate past prime minister of Britain, Gordon Brown, and the agric investment magnet in Belgium, Pierre Vendebeeck, chief executive of Siat NV.
A top government source in Government House, Port Harcourt confirmed the decision of Dangote to storm the energy city with billions of dollars, saying the investment would span the petrochemical industry including methane, ethanol and fertiliser sub-sectors. Thousands of jobs are expected to gush out of the energy city project while subcontractors and suppliers as well as revenue sources for government are expected huge sizes.
Dangote would not be lacking competitors in his striving to venture into the petrochemical industry. There is the proposed $6 billion petrochemical project said to be the largest in Africa being floated by both the NNPC and a Saudi Arabian conglomerate, Xenel. There are also two proposed fertiliser plants by the Federal Government through the NNPC for $4 billion with Indian partners (Nararjuna) each with 1.3 million tons per annum.
Also, Indorama Eleme Petrochemical Company Limited (EPCL), which has successfully pioneered the petrochemical sector, is busy building a $2 billion fertiliser and ethanol plants at its present location as part of an expansion project in the face of rising global demands.
The Rivers State government is said to be keen on cushioning Dangote’s landing in the energy city, and this may include revision of economic policies to attract more investors.
The governor said at the investors’ forum that one of such areas is the public private partnership (PPP) law already enacted which, he said, provides the regulatory framework for collaboration between the state and the private sector.
He said, “Our PPP law provides for viability funding gap where necessary, showing our determination to lean heavily in favour of the investor”.
Dangote is said to have been made to appreciate the fact that “Rivers State is the nerve centre of the Nigerian economy, accounting for 10 percent of the nation’s GDP, according to World Bank statistics”. The governor said the state accounts for over 40 percent of crude oil produced on-shore in the country and 100 percent of the liquefied natural gas exports from Nigeria. The state, according to him, is also quite attractively positioned, being the economic hub of the South South and South East regions of Nigeria. With its accessibility by land, air, water and rail, he said Rivers State is definitely Dangote’s ideal business destination.
Publication date is 11/28/2011
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