Afreximbank Commits US$4bn To Anchor Dangote Refinery Refinancing Deal

The African Export-Import Bank (Afreximbank) has secured the anchor position in the refinancing transaction amounting to $4 billion, raised through the syndication route, for Dangote Petroleum Refinery and Petrochemicals FZE, as the largest participant, contributing $2.5 billion towards the transaction.

The transaction, spread over a 5-year tenure, is intended to rationalise the existing debt and enable the refinery to optimise its capital structure as the refinery grows in scale. The transaction saw Afreximbank assume the role of co-Mandated Lead Arranger, along with Access Bank.

With the capacity to process 650,000 barrels per day, the Dangote refinery is the largest refinery and petrochemical plant on the continent. The refinancing is expected to enable greater flexibility on the balance sheet and pave the way for the facility to become an important supplier of refined petroleum products to the wider continent and beyond.

Afreximbank’s significant commitment to the deal is also an indication of the Bank’s strategic focus on supporting downstream energy infrastructure as an important catalyst for industrialisation. The Bank is continuing to establish itself as a catalytic financier, supporting projects that promote import substitution, intra-African trade, and energy security.

The institution has been consistent in its involvement in the development of the refinery. Since the start of operations in February 2024, it has offered a US$1 billion working capital facility and advisory support for the Naira-for-Crude initiative, an initiative that offers crude procurement and product sale solutions in naira, thus reducing foreign exchange risk in the energy sector in Nigeria.

In his remarks, George Elombi stressed the need to support industrial platforms in Africa, stating that economic stability in Africa will depend on increasing domestic production capacity. On the other hand, Aliko Dangote stressed that the deal will provide Dangote Industries Limited with a solid financial foundation to start the next phase of its growth.

The deal has witnessed significant interest from both African and international lenders, indicating that they have confidence in the energy sector. Overall, the deal marks an important development in the energy sector in Africa, where the refining industry is becoming an integral part of economic planning.