Gas shortage: Dangote spends N.7tr monthly on diesel

By IAfrica
In Nigeria
Aug 18th, 2014
0 Comments
133 Views

•Plans 180,000 jobs by 2017

The President of Dangote Group of Industries, Alhaji Aliko Dangote, has decried the shortage of gas to run the company’s cement plant in Ibese, Ogun State.

The foremost industrialist said he had resorted to using diesel, which had eaten deep into the company’s profit.

The cement factory at Ibese has an installed capacity to generate 210 megawatts (MW) but the shortage of gas to run it has remained its major headache.

Dangote said the Ibese cement plant, in the last six months, had been spending between N230 million and N250 million per day on diesel.

The additional cost, the industrialist said, has been “eating away” the company’s profit.

He said gas shortage was a challenge to the company, adding that the Federal Government should make gas available to enable it operate at full capacity, create more jobs and meet its market’s demand for cement.

Dangote addressed reporters at the weekend in Ibese, Ogun State, after a tour of the company with its distributors ahead of the inauguration of the cement plant’s expansion.

He said: “In the last six months, we have had challenges, mainly gas. Also, the low fuel oil, which has not allowed us to work up to our capacity. Actually, the government should make sure that there is enough gas. This is because the only thing we are getting is gas; so that we can continue to generate our own power.

“If you look at it in the last six months, we have been using diesel to produce power because our generators are made in such a way that if there is no gas, you have to use diesel. Between diesel and low fuel oil, we are spending between N230 million and N250 million per day.

“So, that has really eaten up our profit vis-a-vis last year. But I think now, we have stabilised a bit. We are using coal and, by next year, we will fully be on coal so that we don’t go through this mess anymore.”

Africa’s frontline businessman said the plant expansion, which entails adding two new lines to the existing one, would double the capacity from six million metric tonnes to 12 million metric tonnes per annum.

He said this level would ensure a steady supply of the product to the consumers.

The additional plant, Dangote said, would also require doubling the workforce by about 60 per cent.

According to him, the company is working on how to increase its staff strength from 26,000 to 180,000 through agriculture by 2017.

Dangote said by then, the company would be in a position to take many Nigerians off the unemployment market.

The industrialist said about N150 billion had been spent on the plant’s expansion to meet the demand for cement in Nigeria.

He said: “The demand for cement increases a little bit over that of last year. Already, we anticipated that. So, we decided to double our capacity. We just want to assure Nigerians that we have the capacity to meet their demand through our customers (distributors). Whether high season or low season, we will be able to meet the demand, inclusive of quality that we are talking about, which is 42.5 standard of cement.”

Print Friendly


This post was originally published on this site

Share and Enjoy

  • Facebook
  • Twitter
  • Delicious
  • LinkedIn
  • StumbleUpon
  • Add to favorites
  • Email
  • RSS

Comments are closed.