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Nigeria’s BUA Group Partners Axens of France for Mega Refinery Project

September 3, 2020

Chairman of BUA Group Alhaji Abdulsamad Rabiu

One of Nigeria’s leading conglomerate Bua Group has entered into an agreement with Axens Group of France to build a mega refinery in Nigeria. The refinery according to insiders with knowledge of the project will go head-to-head with Nigeria’s other large scale refinery project, being built by the Dangote Group.

The project will be executed by France’s largest hydrocarbons group Axens which has won the contract to license key refinery technologies to one of Nigeria’s leading industrial conglomerates, the BUA Group. According to the Chairman of BUA Group Alhaji Abdulsamad Rabiu the economics of the project are a ‘no-brainer’: “Nigeria imports 90% of its petroleum products. We spend 35% of our foreign exchange on importing petroleum products.” The new refinery, with a capacity to produce 200,000 barrels per day (bpd), should be operational in 2024. By comparison, the Dangote Group project will produce 600,000 bpd.

The bidding process was managed by energy consultants KBR, which will also be handling subsequent rounds for the engineering and construction phase, currently underway. The refinery will be built using an undisclosed mix of debt and equity, with several development and commercial banks in negotiations with BUA Group.

It comes as a shot in the arm for the French economy, reeling from Covid-19 shutdowns and weeks of strikes prior to the pandemic.The contract was signed in Paris between BUA Group Chairman Abdulsamad Rabiu, and the CEO of Axens, Jean Sentenac, in a ceremony presided over by France’s Minister Delegate for Foreign Trade and Economic Attractiveness, Franck Riester.

France’s Axens headed off strong competition from the US company Honeywell UOP, which got through to the final round, according to sources close to the bid. “President Macron has given special determination and support to this project,” Rabiu was quoted as saying. Interestingly, Rabiu is also the Chairman of the Macron-initiated Franco-Nigerian Investors Club.

For Axens CEO Sentenac, the technologies that Axens is licensing will give Lagos the chance to breathe easier: “We are the world leader in the Euro 5 fuel standard; this has already reduced car pollution in Europe by a factor of 5 or 6, and it also allows Nigeria to start using the latest generation of fuel efficient engines, the first step towards fighting global warming.” The plant also has the ability to refine biofuels. Rabiu believes his investment in sustainability — “It was not cheap!” — will pay off in the long run, as new fuel standards continue to evolve along with the climate crisis. “It is in the DNA of BUA Group; look at our cement plants, the most sustainable in Nigeria, same with our sugar plants.”

“This is the hard part, we cannot get this wrong”, says Rabiu. “It is like in an aeroplane, you always look at who built the engine, it is the most important thing”.

Minister Delegate for Foreign Trade and Economic Attractiveness Riester believes this club is, “one of the things that will help build up the necessary intrapersonal relationships” between industrial players in the two countries, part of a wider French strategy of greater engagement in anglophone Africa.

The new refinery project sets up a direct competition with Nigeria’s other large refinery project, piloted by the Dangote Group that says it will be operational by early 2021. For Rabiu, there is space for another project, despite the growing international glut of refinery projects, the tapering of transport fuel use globally, and the strong local competition, partly because of the projection for fuel use in Nigeria itself. The country today uses around 500,000 to 550,000 barrels a day of petrol. And partly because of demand in the region. The project is sited on the waterfront in Akwa Ibom State. “We will have the marine infrastructure for easy export”, says Rabiu, “And the external market for polypropylene [the other major product from the refinery] is very strong”.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

BUA to Construct Ultramodern Cement Plant, 50mw Power Plant

July 6, 2020

Abdul Samad Rabiu, Chairman of BUA Group

The Chairman of BUA Group has revealed that the power challenges which has been the bane of industrialization in Nigeria has forced his organization to venture into electric power production with the expansion of its operations by building a new cement factory and power plant in Adamawa State of Nigeria. According to the Chairman, Abdul Samad Rabiu who led the BUA Cement Management team on a courtesy call to the Adamawa State Governor, Ahmadu Umaru Fintiri, the company is set to establish a three million metric tonnes cement plant and 50 megawatts power plant in Guyuk and Lamurde local governments of Adamawa state in the North Eastern region of Nigeria. This was revealed when the Chairman of BUA, Abdul Samad Rabiu led the BUA Cement Management team on a courtesy call to the Adamawa State Governor, Ahmadu Umaru Fintiri in the Government House, Yola.

Speaking during the visit, Abdul Samad Rabiu said preliminary findings show that the two local governments of Guyuk and Lamurde are reputed to have good quality of limestone deposits and BUA Cement is ready to begin the investment in the state. He added that the BUA will use new technologies to supply power to the proposed cement plant and communities of Guyuk and Lamurde in addition to providing three thousand direct and five thousand indirect jobs.

The Chairman stressed that the Guyuk Cement Plant will be the major investment in the North East by BUA and solicited the support of Governor Umaru Fintiri to set up the factory in Guyuk. Rabiu said the company made a decision to source its raw materials locally and it has invested billions of dollars in various sectors across Nigeria and therefore urged the state government to support BUA to actualize the Guyuk Cement project. In addition, he praised the commitment of the governor within one year in office in many sectors of development despite the economic challenges in Adamawa.

Responding, Governor Ahmadu Umaru Fintiri said his administration’s effort in exploring local contents has started yielding results and thanked BUA for showing interest in establishing the cement plant in Guyuk. He further assured the management team of BUA that the government will make whatever is needed and provide the necessary support which will create an enabling environment so that the BUA Cement company in Guyuk will become a reality.

He also expressed readiness of the government to protect the investment once it is established and told them that his administration will maintain the good relationship with the company for the benefit of the state.

BUA is Nigeria’s second largest Cement Producer by volume with cement plants in Sokoto and Edo States. The Company’s newest plant in Sokoto is expected to be operational in 2021. When completed, the Guyuk Cement Plant will bring BUA’s total capacity to 14million metric tonnes per annum.

Kelechi Deca