Dangote, XCMG Seal $400M Deal to Expand Lekki Refinery to 1.4 Million Barrels Per Day
In a significant step that could change Africa’s energy landscape, the Dangote Group has signed a $400 million agreement with XCMG Machinery for construction equipment to speed up the expansion of its $20 billion Dangote Refinery.
This deal aims to increase the refinery’s processing capacity from 650,000 barrels per day (bpd) to a remarkable 1.4 million bpd. This expansion would make it the largest single-site refinery in the world.
Industry experts view this agreement as a crucial moment for Nigeria’s oil and gas sector, with lasting effects on fuel imports, currency stability, and regional export strength.
Inside the $400 Million Dangote and XCMG Agreement
The agreement gives Dangote access to a fleet of modern heavy-duty construction machinery to boost refinery expansion and related industrial projects. The equipment will help with:
Upgrading refinery capacity
Expanding the petrochemical plant
Increasing fertilizer production
Developing infrastructure across Dangote’s operations
These new machines are expected to be operational within three years, which will significantly shorten construction times.
Analysts believe that using modern XCMG equipment could reduce project delivery times, helping Nigeria achieve energy self-sufficiency faster than anticipated.
The refinery, located in the Lekki Free Trade Zone in Lagos, already provides about 62% of Nigeria’s petrol consumption. Expanding to 1.4 million bpd would:
Double refining output
Eliminate Nigeria’s dependence on imported fuel
Position Nigeria as a net exporter of refined oil products
Strengthen West Africa’s energy supply chain
If successful, this new capacity could outpace several major global refineries and firmly establish Nigeria in the global downstream oil markets.
While fuel production takes center stage, the refinery expansion encompasses more than just petrol and diesel.
Polypropylene production is expected to rise from 900,000 tonnes per year to 2.4 million tonnes per year, bolstering Nigeria’s plastics and manufacturing sector.
The Dangote Group considers the XCMG partnership an important step toward achieving its ambitious goal of a $100 billion enterprise valuation by 2030.
The expansion aligns with broader strategic objectives:
Company executives also aim to become the top construction firm worldwide, leveraging partnerships like XCMG to grow quickly.
Why the XCMG Partnership Matters
XCMG Machinery ranks among the world’s largest construction equipment manufacturers and is known for its heavy-duty machinery used in major infrastructure projects.
By teaming up with a recognized equipment leader, Dangote benefits from:
Faster project timelines
Improved engineering efficiency
Access to cutting-edge construction technology
Enhanced operational scale
This partnership reinforces Nigeria–China industrial connections and highlights growing Sino-African economic collaboration.