Nigeria’s Dangote Group has signed a US$400 million equipment deal with China’s Xuzhou Construction Machinery Group (XCMG) to accelerate the expansion of its oil refinery towards a planned capacity of 1.4 million barrels per day, the company said on Tuesday.
The agreement will enable Dangote to acquire a wide range of heavy-duty construction and industrial equipment to support major projects under development across refining, petrochemicals, agriculture and infrastructure, the company said in a statement.
Dangote said the additional machinery would complement existing assets deployed at its refinery complex and help fast-track construction timelines. The expansion programme is expected to be completed within three years.
As part of the broader expansion, polypropylene production capacity will rise to 2.4 million tonnes per year from 900,000 tonnes currently. Urea output in Nigeria is set to triple to 9 million tonnes per year, in addition to an existing 3 million-tonne plant in Ethiopia, positioning the group as the world’s largest urea producer, Dangote said.
Production of linear alkyl benzene, a key raw material used in detergents, will increase to 400,000 tonnes annually, making Dangote the largest supplier of the product in Africa. Additional base-oil capacity is also planned under the programme.
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Dangote described the XCMG agreement as a strategic investment aligned with its ambition to build a $100 billion enterprise by 2030.
“The additional equipment we are acquiring under this partnership will significantly enhance execution across our projects,” the company said.
Owned by Nigerian billionaire Aliko Dangote, the $20 billion Dangote Petroleum Refinery, located in Ibeju-Lekki near Lagos, began operations in 2024 after years of delays.
Once fully operational, the refinery is expected to significantly reduce Nigeria’s dependence on imported refined petroleum products and reshape fuel supply dynamics across West and Central Africa. The project is widely seen as a cornerstone of Nigeria’s push to boost domestic refining capacity and conserve foreign exchange.
Nigeria has long relied heavily on imports to meet its domestic demand for refined petroleum products, despite being Africa’s largest crude oil producer. Years of underinvestment, operational challenges and repeated delays in public refinery rehabilitation projects have left the country dependent on fuel imports, straining foreign exchange reserves and exposing the economy to global price volatility.
The $20 billion Dangote Petroleum Refinery, owned by Nigerian billionaire Aliko Dangote, was conceived as a private-sector solution to this structural gap. Located in Ibeju-Lekki near Lagos, the refinery is designed to process a wide range of crude grades and, once fully expanded, is expected to become one of the largest single-site refineries in the world.
Dangote Group has pursued an integrated industrial strategy around the refinery, linking refining, petrochemicals and fertiliser production to serve both domestic and export markets. The group already operates a large fertiliser complex in Nigeria and a urea plant in Ethiopia, supplying agricultural inputs across Africa.
China has become an increasingly important partner in Africa’s industrial expansion, with Chinese firms supplying financing, technology and heavy equipment for large infrastructure and energy projects. Xuzhou Construction Machinery Group (XCMG) is one of China’s largest manufacturers of construction machinery and has expanded its footprint across African markets in recent years.
Analysts say the Dangote refinery expansion could significantly alter fuel supply dynamics in West and Central Africa by reducing regional reliance on imported refined products, improving energy security and lowering logistics costs. The project is also expected to support job creation, industrial development and foreign exchange savings for Nigeria as production ramps up.
