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Business News of Thursday, 27 February 2020

Source: africanews.com

Dangote Fertilizer commences pre-testing of $2bn plant ahead of inauguration


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Dangote Fertiliser Limited has begun countdown to the inauguration of its $2 billion Granulated Urea Fertiliser complex located in the Dangote Free Zone.

With a capacity of 3 million tonnes per annum, the plant has been classified as the biggest project in the entire fertilizer industry history in the World. Siapem of Italy is the Engineering, Procurement and Supervision (EP) Contractor for the project, while Tata Consulting Engineers, India, is the Project Management Consultants (PMC) for the project.

At this time, several critical sections of the plant are going through various stages of pre-commissioning and test-run. Virtually all the sections of the plant such as Central Control Room, Ammonia and Urea Bulk Storage, Cooling Tower, Power Generator Plant, Granulation Plant, have all been completed and are going through pre-testing.

Already, Dangote Feritiser has started receiving gas supply from the Nigerian Gas Company and Chevron Nigeria Limited under the Gas Sale and Purchase was Agreement to supply 70 million standard cubic feet per day (Scf/d) of natural gas to Dangote Fertiliser Limited.

The project, which will create thousands of direct and indirect jobs in construction and related fields, will provide a major boost to the agricultural sector by significantly reducing the importation of fertilizer in Nigeria and ultimately removing the need for imports when plant is in full production.

Group Executive Director, Strategy, Portfolio Development & Capital Projects, Dangote Industries Limited, Devakumar Edwin said Nigeria will be able to save $0.5billion from import substitution and provide $0.4 billion from exports of products from the fertilizer plant. “Thus, the supply of fertilizer from the plant, will be enough for the Nigerian market and neighboring countries,” he said.

Edwin said: “I am happy that by the time our plant is fully commissioned, the country will become self-sufficient in fertilizer production and even have the capacity to export the products to other African countries. Right now, farmers are forced to utilize whatever fertilizer that is available as they have no choice, but we need to know that the fertilizer that will work in one State may not be suitable in another State, as they may not have the same soil type and composition. The same fertilizer you use for sorghum may not be the fertilizer you will use for sugar cane.”

He stated that the Dangote fertilizer project, which is estimated to gulp $2billion is the largest granulated Urea fertilizer complex to emerge in the entire fertilizer industry history in the world, with its three million tonnes per annum capacity.

He pointed out that the fertilizer complex, which is sited on 500 hectares of land has the capacity to expand as it is only occupying a small fraction of the allotted portion.

Edwin added: “The management of the complex are confident that the fertilizer business will deliver reasonable profit to the company and its shareholders as it is projected that population growth and the need for food production will jack up the consumption of Urea fertilizer beginning from 2020 when production of the production would have commenced in earnest.

“The current consumption of Urea estimated at a dismal 700,000 tonnes per annum by Nigerian farmers is said to be due to very poor usage and is believed to be the cause of poor product yield, which threatens food security in the country.

“By 2020, Nigerian population is projected to increase to about 207 million which would lead to increased food production. Estimates points out that around five million tonnes of fertilizers are required per year in Nigeria in the next five to seven years bifurcated into 3.5 million tonnes of Urea and 1.5 million tonnes of NPK while current production levels in Nigeria are at 1.6 million tonnes by 2019.”

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