Africa’s leading manufacturing company, Dangote Group is investing $250 million to build coal plants that will help address the low supply of gas and LPFO (black oil) which it said is affecting its business operations in Nigeria.
Group Managing Director (GMD) of Dangote Group, Devacumar Edwin said the company is taking this alternative route because empirical evidence shows that “there is really not going to be major improvement” in the country’s gas and LPFO supply situation in years to come.
Despite the large clusters of gas reserve in Nigeria, the company said there has been short supply of gas and LPFO (Black oil) for the past six months.
The Company said the unreliable energy supply has necessitated a high cost alternative – importing fuel to power its plants. Meanwhile, the coal needed for the new plants will be imported from South Africa.
Dangote has already placed an initial order of 30,000 tonnes of coal from South Africa, the continent’s second largest economy. Edwin said the coal plants will be used to power its cement plants in Ibesse, Gboko and Obajana.
A 54 megawatts coal-base power plant is already in place at the Gboko plant in Benue State. The company is currently working towards installing equipments and mills at Ibesse and Obajana plant in Kogi State.
Edwin however pointed out that importing coal from South Africa is a temporary measure as the group is already looking into investing in the coal industry, a largely untapped sector. The group has begun exploring opportunities for local coal mining.