Issues to Consider before Dangote’s Refinery Comes on Stream

Samuel Enoch
Samuel Enoch

By Stephen Ezenweani

If things go according to plan, Nigeria, in 2020, will get a new refinery, according to media reports. The refinery, which is currently under construction at Lekki Free Trade Zone, is financed by Africa’s richest man, Aliko Dangote, who’s the group president and chief executive officer of Dangote Industries Limited. When completed, the refinery is expected to enhance the country’s sufficiency in petroleum production and halt the embarrassment of an oil rich African country like Nigeria importing fuel, as currently subsists, for domestic consumption.

With its four major refineries working at below production level, thus unable to meet their combined 445,000 bpd capacity owing to corruption and bad leadership, Nigerians, in the last two decades particularly, have borne the brunt of the problem. Petroleum shortages manifesting in endless queues for the product by motorists at fuel stations across the country, price dynamics and importation cost, saw to the removal, at different times, of fuel subsidies by respective governments to the chagrin of many Nigerians. That’s the memory many have of the failure of the authorities to ensure maximum production and supply of petroleum products in the country. For that reason, some people are already singing Dangote’s praise for embarking on the project. They are not even waiting for the refinery to be completed or commissioned; they are singing his praise, perhaps believing that, since this is a contract by a man of means, it would come to fruition unlike the case with many government-funded projects that are abandoned midstream. Interestingly, it is not only private citizens that await with excitement, the completion of the project. The Nigerian government too is happy as it expects that the refinery will make up for its shortcoming.

dredging work by the lagoon
dredging work by the lagoon

Early last month, Timipre Sylva, Nigeria’s minister of State for Petroleum Resources, visited the site of the projected 650,000 barrels per day, BPD, capacity refinery and assured Dangote’s management of government’s support in completing the project. He said: “This is a very heartwarming moment for all of us as Nigerians. There is no way a project of this magnitude will be going on and government will not be interested. Anywhere in the world, if a citizen of a country has committed so much money into investing in this kind of massive project, government must show interest.

“I must say now that Dangote Group has turned this project to the story of all of us. We must all support this project to succeed because the success of this project signals a lot. Of course, I am sure that the whole world is looking at the success of this project. Investors all over the world will look at the success of this project and will come to Nigeria to at least also enjoy the benefit of investing here. So, we are actually here to assure you, Dangote Group, that as a government, as NNPC, we will support this project as much as we can. You have definitely done very well,” said Sylva.

When completed, the Dangote refinery, as has since been revealed by the company’s management, will operate as a commercial enterprise and stand as a subsidiary of the Dangote conglomerate. Not content with his financial achievements, Aliko continues to seek fortune, and fortune he continues to acquire. Good for him! But there are issues with his refinery project: the site on which the refinery is being constructed is a subject of controversy today owing to unresolved issues regarding its acquisition. Long before now, the refinery land had been a source of crisis for some members of the communities whose lands were acquired for the project by the Lagos State government which transferred ownership to Dangote after money was believed to have exchanged hands. According to a government white paper that investigated an incident which happened on October 12, 2015 at the Lekki Free Trade Zone that led to the death of Tajudeen Disu, the managing director of Lekki Worldwide International Limited (LWIL), the company that oversees investments in the zone, “2,735 hectares were conveyed to DANGOTE INDUSTRIES LTD for a consideration of 100 MILLION DOLLARS.”

The land is described as “colossal…and may be required to be reduced in order to foreclose any future tempting speculative disposal of large parts” of it. The 2,735 hectares were part of a 16500 hectares that, in 2004, was “marked for the LFTZ project,” by the Lagos State government.

Dangote’s truck by the entrance to refinery site
Dangote’s truck by the entrance to refinery site

As compensation, the Lagos State government paid between N10,000.00 to 300,000.00 to some owners of the acquired lands. However, the white paper points out that “under the cover of the provisions of the LAND USE ACT, the LASG paid compensation for crops and buildings only but not for empty land even though clause 4(k) of the MOU would appear to entitle them to compensation for landed claims per se.”

The report, dated March 2016, titled: GOVERNMENT WHITE PAPER ON THE REPORT OF THE TRIBUNAL OF INQUIRY INTO THE CAUSE OF CIVIL DISTURBANCES AT THE LEKKI FREE TRADE ZONE ON 12th October, 2015, was the submission of a tribunal committee set up by the immediate past government of Lagos State headed by Akinwunmi Ambode, to probe the circumstances leading to the death of Disu. The tribunal was led by Hon. Justice Adesuyi Olateru-Olagbegi who served as chairman. Other panel members were Tunde Seriki, Yemi Lawal, Fuad Kassim, Rafeequat Arinola Onabamiro and Adebayo Haroun.

Among others, the six-man tribunal team, which was inaugurated on October 22, 2015, was charged with inquiring “into the remote and immediate causes surrounding the recent public disorder at the Lekki Free Trade Zone on 12 October, 2015; invite memoranda from individuals, groups, stakeholders, host communities and other interested members of the public on issues relating to the said public disorder, proffer solutions that will forestall a re-occurrence of such public disorder in the area and other parts of the State and make necessary recommendations to the State Government based on the findings of the Tribunal.”

Following its inauguration, the tribunal members went to work and their effort is seen in the March 2016 white paper.  The document reveals that, “on Tuesday, 1st December, 2015, members of the panel made a trip to the villages and communities in LFTZ with the press and TV journalists in attendance. The Tribunal visited (a) the coastal villages of Tiye, Loore, Idasho, Imobido, Ilege, Oke-Segun, Lekuru, Itokin, Okeyanta, Idotun, Itoke, Eleko Alasia, Okunraiye, Olomowewe, Abejoye, Origanrigan 1&2, Ojuoto, Pankere, Kajola, Ajegunle and (b)Epe Lagoon, and Oko Orisan.” Consequently, “panel members mingled with members of the community and received representations from them first-hand as to their housing and other communal needs e.g schools and medical facilities.”

Following the interaction, the committee members report that the Memorandum of Understanding that followed the transfer of the land to Dangote, was breached by the Lagos State government and other stakeholders. “From the various representations made to the Tribunal, it is clear that the Memorandum of Understanding (MOU) is a masterpiece document, people-oriented, forward-looking and equitable with massive potentials and capability to industrialize the Zone, eradicate poverty therein and catapult Lagos State to a level of development not before seen in Africa,” the report discloses, but notes that “the tragedy of the MOU, however, was that it was honoured more in breach than in observance by virtually all the parties to the MOU in varying degrees but the most debilitating breaches which went to the root of the MOU were committed by LASG (Lagos State Government) and LWIL.”

Instances of the breaches of the MOU were cited.

Under the title, DENIAL OF EQUITY PARTICIPATION AND DIRECTORSHIP SLOT IN LEKKI WORLDWIDE INVESTMENTS LIMITED; CLAUSES 4(f) & 8(a), “the affected villages and communities are entitled to (a) a minimum of 2.5% Equity share fully paid-up on their behalf by LASG and (b) Directorship slot(s) in LWIL.” However, the investigators point out that “the aforesaid entitlements have been and are still being denied to the affected villages and communities. The excuse by LWIL is that “the companies/investors have not fully taken off.”

The panel members viewed LWIL’s excuse as untenable as “under the COMPANIES AND ALLIED MATTERS ACT, every incorporated company must have a share capital part of which or all of which must at any given time be fully paid up.”

In a headline titled “Sidelining of the Resettlement Committee,” the panel informs that whereas clauses 4(1),4(m),4(n),6(k) of the MOU established a “Resettlement Committee” (RC) to be composed of all the parties to their agreement including Accredited Representatives of the affected villages and communities as to 30% of the whole committee…in breach of the MOU, LASG and LWIL have over the years sidelined the RC and by implication, sidelined the Accredited Representatives of the affected villages and communities, the only exception is the LEKKI EPE INTERNATIONAL AIRPORT LAND OWNERS, EPE (said to be made up of about 182 villages)…”

Maurice Fangnon
Maurice Fangnon

In the other villages and communities, “the Tribunal observed that LASG and LWIL rather than deal with the accredited RC have in breach of the MOU set up parallel bodies like “Community Relations Committee and Community Welfare Committee” which were not recognized by the MOU.” This, the report states, “led to a loss of trust and confidence in the Accredited Representatives and undermined their influence and authority to broker peace in terms of strife.”

Those weren’t the only breaches.

Though Clause 4(o) and 6(t) respectively of the MOU states that the LASG and LWIL shall “ensure the provision of adequate alternative housing as resettlement to individuals and families that may be displaced by the LFTZ project,” the “Panel found no evidence of Government housing anywhere in the communities.” And whereas Clause 4(p) of the MOU provides that displacement or eviction shall occur ONLY after “individuals, families, villages or communities have been duly and fully compensated and/or resettled, some communities were given land located in other people’s land that had not themselves been compensated by LASG. The allottees were in such cases denied possession. This breeds animosity, confusion and disharmony amongst neighbouring communities and should be discouraged.”

Part of the agreement that followed the land acquisition by Dangote Industries through Lagos State government is that 750 hectares of the original land would be returned to the owners but that wasn’t adhered to as the displaced communities that were granted excision of 750 hectares of land under the MOU were instead given 375 hectares, and, in many cases, it was found out that certificate of Occupancy (C of O) was not issued by LASG in regard to excised land where possession had been taken.

In the case of Okunraiye community, one of the many communities whose lands were acquired for the refinery project, “whilst its land was given to ABEJOYE ZONE which has allegedly been selling to third parties at commercial rates, the original owners, Okunraiye community were given excised land in another village where they have been deprived of possession.”

In a subhead titled INADEQUATE OR NO COMPENSATION AT ALL, “the communities in the LFTZ allege that they were dispossessed of their ancestral lands and deprived of their means of livelihood (farming and fishing) by Government’s acquisition under the pretext of using the land for overriding public interest but that their lands were then sold to private investors at mind boggling commercial rates.” These were part of the issues, according to the report, “which pre-dispose the communities to hostility against the LASG, LWIL and private investors. It is the same consideration that led to the erection of barricades at the entrance of Dangote by Okunraiye youths” on October 12, 2015.

Before 12th October, 2015, the report says, youths and members of Okunraiye Community had allegedly sought to discuss employment and general welfare issues with the management of Dangote Industries Limited but could not secure appointment for a meeting.

On 12 October, some Okunraiye youths went back to the company and barricaded its entrance and also laid charms there. Following that, the police “from Mopol 49” were invited by Dangote Industries. The company also reportedly invited Disu. “The people alleged that all the while, the policemen were shooting and firing canisters of teargas; the police deny this. In any case, Mr Disu put his hands up (to show that he had nothing in them), walked towards the people and pleaded for peace. Suddenly, Mr Disu went down. He was later confirmed dead at St Nicholas Hospital located within the zone. It was found at the hospital that a bullet went into his neck area behind the right ear.”

The citing of industry in an area, triggers for residents of the place and adjoining communities, hope of job opportunities and financial gain. When the reporter visited the Lekki Free Trade Zone in August 2018, some indigenes of the area said that when the Lagos State government showed interest in acquiring their land for the refinery project, which began during the administration of Bola Tinubu who served as governor of Lagos State from 1999 to 2007, not a few of the community members were hopeful of better days, even as some, according to a source, were unhappy and suspicious of the venture given the reputation of Lagos State government in such transactions  which predated Ambode’s administration.

During the military era, the Lagos State government demolished and forcefully possessed land of residents of Maroko, a waterfront community in the state which later became a haven for rich and affluent people. There are more recent examples like Babalola and Otodo Gbame in Lekki which were demolished in 2017. Last year, a follow up visit to Babalola revealed new buildings springing up where ramshackled structures once stood.

According to the March 2016 White Paper, while the MOU on the Lekki Free Trade Zone requires the government through the LWIL to recruit workers from the affected communities and ensure their on the job training, the indigenes claim that little was done for them in that regard although LWIL insisted that the people were favoured with jobs. The panel, however, stated that “there was no evidence produced to the Tribunal to show that LASG put any structure on the ground to monitor the activities of LWIL and to ensure that LWIL carries out its obligations under Clauses 6(g) and 6(h) of the MOU. There was equally no evidence in the presentations of the Lands Bureau of Lagos State or Ministry of Commerce, Industry & Cooperatives to show that LASG provided any “skills training” or “job creation” for members of the affected communities.”

When the reporter visited the Lekki Free Trade Zone, some community members said that they had not benefited much from the ongoing refinery construction in the area. They said they were mainly being offered low paying site jobs by Dangote Industries while people from outside the region secured lucrative jobs. The people interviewed, which included Samuel Enoch, a community leader, lamented the loss of their land and neglect by the Lagos State government and Dangote Industries since the land exchanged hands. Enoch complained that, rather than protect their interest in the land transaction, the Lagos State government sought to break the will of the people seeking questions on the sale through divide and rule tactics that ended up creating confusion and suspicion among the community members. Some other indigenes of the area said the loss of their ancestral land denied them of their source of livelihood as many of them were farmers who earned money from their farm produce. They complained that the loss of their farmlands to the refinery project, led to a rise in the price of food in the area as farming had reduced, leading to low food production and migration from the area owing to disenchantment. According to a source, hundreds of thousands of people were displaced by the refinery land acquisition.

There was also concern about ongoing dredging in the area that was being carried out by Dangote’s company which some of the people were not happy about as they said the dredging had made fishing laborious as they had to travel farther on the lagoon to source fish which were being driven away by the dredging activity. The white paper draws attention to this when it said that “on the visit of Panel members to the coastal villages and communities, there were complaints that the dredging activities of Dangote were very inimical to their economic survival.” The people alleged that the dredging was gradually ebbing away their land, uprooting their coconut trees, forcing their fishermen to go further into the ocean to fish at a much greater cost; leading to low income for their fishermen.   A visit to the area corroborated the findings of the panel that “dredging was going on during the visit; that the coastal lands were receding and some coconut trees that had been washed away were seen floating in the ocean.” Also, the “deleterious effects of the dredging were most pronounced in the villages of Imobido, Imagbon-Segun, Idasho and Tiye.” Given what it found, the “Tribunal observed that the act of LASG in excising land to the coastal areas and then granting dredging concessions to Dangote amounts to giving land to the coastal villages with one hand and taking the lands away with another hand.”

There was also concerns about the impact oil and gas exploration will have on the environment when the refinery commences operation. The panel stated that some residents of the area were concerned by the health hazards posed to them by the upcoming oil exploration and that “it was alleged that no Environmental Impact Assessment was carried out.”

However, Dangote Industries, in reply to the allegation, said that the Environmental and Social Impact Assessment Certificate had not been issued to the company even though it has complied with all the requirements of the law. The company “produced to the Tribunal, some documentary evidence consisting of: final Environmental & Social Impact Assessment Report, correspondences between them and Federal Ministry of Environment, photographs, CDs of the Panel Review Meeting” and “gave a clear undertaking that production will not commence until the said Certificate is produced.”

The failure of the Lagos State government to fulfill the terms of the MOU, according to the tribunal members, paved way for the event of October 12, 2015, that claimed the life of Disu, the managing director of LWIL, which, “under the MOU, is “conceived as the ears, eyes and hands of the LASG (Lagos State Government) in the actualization of the laudable objectives of LFTZ.”

It may also be instrumental to why indigenes of the area were perceived by investors in the free trade zone as inimical to their interest as the panel received complaints against members of the villages and communities that make up the region. They were accused of extortion, constant violent disturbance and disruption of production activities, destruction of properties and assault of workers “which have the combined effect of slowing down commercial activities in the Zone, scaring away potential investors and leading to dis-investment by existing investors.”

The tribunal members, as a way of resolving the issues and ensuring a peaceful atmosphere within the Lekki Free Trade Zone, made a number of recommendations to the Lagos State government some of which, as revealed in the white paper, were turned down. In view of the fact that the Lagos State government granted the villages and communities 375 hectares of land instead of the 750 hectares agreed in the MOU, the committee advised that “the LASG should make up the deficit by giving an additional 375 hectares as agreed under the MOU.” They also advised that Certificates of Occupancy (C.of O.) should not be granted globally to all villages and communities lumped together as is presently the practice of LASG but should be granted separately to each affected community.

In regard to this request, the Lagos State Government said it “accepts the principle of sanctity of an agreement” but “rejects any additional grant of land.”

Another recommendation of the panel members which the Lagos State government did not commit to doing beyond simply noting the advice, was about reviewing or withdrawing Dangote’s dredging concessionary right as well as improving the housing and environmental condition of the Lekki free trade zone, something that brought to mind, images of the Niger Delta, the Nigerian oil rich region that’s marred by poverty and squalor. They point that, “as it is, the LFTZ is a confluence of wealth and poverty standing on the same land; the wealth is symbolized by the growing gigantic industrial developments on the left side of the road as one drives into the Zone whilst the poverty is symbolized by the squalor on the right side. Aside from the imperative of living up to its promises under the MOU, LASG should conceive a befitting Housing Scheme in the villages and communities; unless that is done, the right side will not only constitute a nuisance and shameful embarrassment to the zone, it will dramatize the inequity and neglect of the people by its Government and the investors.”

Contacted to give the Dangote Industries side of the story, an official in the media department of the company refused to reply to the questions sent through the email but preferred to speak to the reporter off the record.

He denied the notion that Dangote Industries was involved in land grab or had acquired land for the refinery project without paying for it, and insisted that the land was legitimately acquired and paid for through the Lagos State government.

Four years after the inauguration of the probe panel and with their findings released, sources said that the Lagos State government had not fulfilled any of the recommendations contained in the White Paper or honour the agreement in the MOU. And with Ambode having been replaced by Babajide Sanwo-Olu as Lagos Governor, the people continue to demand for a better deal from the land sale and implementation of the MOU as agreed.

Maurice Fangnon of the Centre for the Defence of Human Right and Democracy in Africa who works closely with some displaced indigenes of the Lekki Free Trade Zone on the land issue, told me two weeks ago that nothing, as far as the peoples’ condition and demands have changed and that they have decided to approach ECOWAS Court in their search for justice in the matter since earlier effort instituted through the National Human Rights Commission, didn’t  yield fruit as it suddenly stopped sitting.

When contacted on December 16 for update on the White Paper, Gbenga Omotoso, Lagos State commissioner for information, promised to find out and on December 18, said that the matter is already in court and for that reason, Sanwo-Olu’s administration won’t comment on it in order to allow the court do its work.


Stephen Ezenweani is a Nigerian independent freelance journalist

– Dec. 23, 2019 @ 12:59 GMT |

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