00:11Welcome to this exciting additional Business Africa.
00:14I'm your host Afolake Uyloye, the top stories this week.
00:18Dangote is expanding its energy business across Africa,
00:21putting local capital and cross-border infrastructure
00:24at the center of the continent's refining future.
00:30South Sudan's small businesses turn to solar as unreliable electricity grid
00:34leaves entrepreneurs facing blackouts, rising costs and lost income.
00:43Nigeria's creative economy enters a new era as young entrepreneurs
00:47turn global cultural influence into sustainable businesses and jobs.
00:55Dangote Group is seeking to turn its Nigerian refining success
00:59into a continental energy business.
01:01The group is opening up its flagship refinery to public investors
01:05in what is said to be Africa's largest ever IPO,
01:09while simultaneously planning new refineries, storage terminals
01:13and fuel pipelines stretching across several African markets.
01:17For Dangote, the challenge now is not simply building infrastructure,
01:21but financing, operating and connecting assets across borders.
01:27For decades, Dangote has been Nigeria's industrial champion.
01:32Now it aims to go continental, turning its 650,000 barrel-a-day refinery
01:38into a pan-African energy hub.
01:42Its landmark share offer seeks to raise about $1.6 billion
01:46and attract up to 10 million investors.
01:51The ability to bring in as many investors, the target is 10 million.
01:57You know, this is capital formation at its best.
02:01Raising capital domestically, also some foreign investors also.
02:05I think it's really, really kind of, you know, a big deal for our market.
02:08And not just for the exchange, but for the continent.
02:11And you're going to see other companies following its footsteps.
02:14It indicates that there is capital, there is money in our markets,
02:18and people need to take advantage of it.
02:21But continental expansion also brings risks.
02:24Cross-border pipelines, terminals and refineries
02:27require government cooperation, stable regulations,
02:31reliable crude supply and multi-currency financing.
02:35There's no risk at all.
02:36I think, you know, the asset that's been built,
02:38it's profitable, it generates an income.
02:42You see, right there, the plan is to pay dividends.
02:45So there's really no risk.
02:46I think as long as there's demand for the products,
02:49the company continues to generate income.
02:52That capital is expected to fund more than one refinery,
02:55including in Kenya, plus fuel storage in Namibia
02:57and distribution links to Zambia and the DRC.
03:00The plan supports the AU goal to strengthen regional value chains
03:03and reduce reliance on imported refined fuel.
03:06In Nigeria, securing competitively priced domestic crude
03:10remains a key challenge, despite the refineries' growing profitability.
03:15We're joined by David Bird, CEO and Managing Director at Dangote Refinery.
03:20Welcome to the show.
03:22Now you've called this the people's IPO,
03:24but with inflation and pressure on the currency,
03:28how can ordinary investors be confident they're getting fair opportunity
03:33rather than taking on excessive risk?
03:36So our IPO, we've listed the September 14th,
03:39we launched the listing of the Dangote Refinery
03:42on the Nigerian Stock Exchange
03:44with a sole objective of driving participation.
03:48So we have a very bold target of 10 million subscribers
03:51that influenced how we priced it.
03:54So it's a very affordable pricing
03:55that influenced an incentive scheme
03:57that we've attached to retail investors.
04:01If you buy 10 shares, hold it for one year,
04:03you'll get a bonus share or for two years,
04:05we'll get an additional bonus share.
04:07So a lot of this thinking and then being fully digital,
04:09so really leveraging the incredible innovative nature
04:13and entrepreneurial nature of West African fintech companies, etc.
04:17So really making sure we have broad reach,
04:20broad exposure and simplicity of participation
04:24to drive that retail uptake
04:26so that all Nigerians feel that they have the opportunity
04:30to own a piece of the Dangote Refinery.
04:32When will consumers actually feel the benefits
04:35of the Dangote Refinery
04:37through lower and more stable fuel prices?
04:40Having the processing capability
04:43with a domestic refinery like Dangote
04:45shortens the cost.
04:47Previously, West African crude
04:49was having to travel long distances to Europe,
04:51get processed in smaller, older, less efficient refineries.
04:55That product put back on a ship.
04:57All of that was value leakage and inefficiency
05:01that ended up being paid for by the Nigerian consumer.
05:04So right now, we're thrilled to be able to continue to supply directly.
05:07We've taken cost out of that supply chain.
05:10We're further going down that path
05:12through our direct distribution models.
05:14So we are actually now delivering directly to retail stations,
05:18ex-refinery.
05:19So the boys, a lot of that double handling
05:21through various terminals and tank firms.
05:24So all of this was with a singular focus on ensuring
05:27that we can lend our products as cheap as possible
05:30into the retail station.
05:32How are you ensuring this benefits Nigerians
05:35before prioritizing exports?
05:37So right now, we're very proud of our both commercial capability
05:41to access a wide variety of crudes and feedstocks.
05:45We're a merchant refinery,
05:46so we're not beholden to any individual crude or feedstock.
05:50We have incredible trading and commercial capability
05:52to continue to be in the market,
05:54securing advantage feedstock.
05:57We're in the business model of daily margin maximization.
06:00So that's point number one.
06:02We have no shortage of crude.
06:03We can process a wide variety of crudes,
06:05and we continue to secure that
06:06from a wide variety of counterparties.
06:10And then we have a very strong technical team.
06:12It's a highly automated, high-tech asset
06:15that we've built,
06:16being the world's most modern refinery.
06:17So it's all about reliability and utilization.
06:19We're thrilled to have gone and increased past
06:22our nameplate capacity of 650,000 barrels a day.
06:25We're now at 700,000 barrels a day.
06:27So we continue to drive that reliability and utilization.
06:30And then we spend a lot of effort in our marketing
06:33and continuing to enhance our distribution capability
06:36through our direct delivery model with our trucks.
06:38So it's all our focus is on continuing to sustain
06:41our production day in, day out
06:43of producing clean fuels for the Nigerian market.
06:46Thank you so much for those insights.
06:49Have a good one.
06:53Less than 10% of South Sudan's population
06:56is connected to a formal power grid
06:58and frequent blackouts are putting small businesses
07:01under enormous pressure.
07:03For many entrepreneurs,
07:04the answer is increasingly solar power,
07:07helping businesses stay open,
07:09reduce energy costs,
07:10and protect their incomes.
07:12South Sudan has the world's lowest rate
07:15of access to electricity,
07:17with less than 10% of the population
07:20connected to a formal power grid.
07:22In major towns,
07:24isolated networks routinely collapse.
07:28For small business owners,
07:29a fragile grid means lost revenue
07:32or relying on costly generators.
07:35But a growing shift
07:37towards decentralized commercial solar
07:39is providing a viable way out.
07:42Solar system, my business,
07:44it has really introduced my expenses
07:48and it has increased my income.
07:51Local engineering and solar companies
07:53like MEC Energy are driving this transition,
07:57installing tailored off-grid kits
07:59that keep essential appliances running.
08:03The government is also partnering
08:04with international donors like the World Bank
08:07to roll out mini-grid pilots
08:10and stand-alone public solar projects.
08:13Electricity is a need for everybody,
08:16whether a business or an individual.
08:18And by virtue of that,
08:19South Sudan does not have a very reliable grid,
08:21that's what I could say.
08:22I wonder if we are possibly 10 or 20%
08:25covered with electricity.
08:27So solar has become a very handy package
08:30for every business
08:32or for small-scale businesses.
08:34While a unified national grid
08:36is still years away,
08:37local entrepreneurs are turning sunlight
08:40into working capital.
08:46Nigeria's global cultural influence
08:48is already undeniable.
08:50From Afrobeat and Nollywood
08:52to fashion,
08:53food and digital content,
08:55but global popularity
08:56does not automatically translate
08:58to sustainable businesses or jobs.
09:01As Nigeria targets a major expansion
09:03of its creative economy by 2030,
09:06the question is,
09:07what do young entrepreneurs need
09:09to turn talent and global demand
09:11into sustainable livelihoods?
09:13We'll take a closer look.
09:16From Afrobeat and Nollywood
09:18to fashion, food and digital content,
09:21Nigeria's creative economy is going global.
09:24It already employs more than 4.2 million people
09:27and contributes 2.3% of GDP.
09:30With millions more entering
09:32the workforce each year,
09:33the sector could become
09:35a major source of jobs.
09:40One of the big ones, I think,
09:42is the responsibility
09:43that corporates, for example,
09:45have to support that ecosystem.
09:48Nigeria's also have the responsibility
09:49as well, I think.
09:50If we like what these creatives
09:54are putting out about Nigeria
09:55and telling our stories,
09:57then we have a responsibility
09:58to support them,
10:00drive that even more.
10:03But turning opportunity
10:04into livelihoods
10:06requires more than talent
10:07and an audience.
10:08Creative entrepreneurs
10:09also need access to finance,
10:12business skills,
10:12IP protection
10:13and international markets.
10:16As a creator,
10:18you know how to do your craft.
10:20But as a business owner,
10:22you know how to build a business
10:24from ground up.
10:25You know how to market it,
10:26package it, promote it,
10:28sell it, manage the money
10:31and also be visible.
10:33For entrepreneurs,
10:34taking Nigerian products abroad,
10:36success also means understanding
10:37what makes African creativity distinctive.
10:40Nigeria aims to turn the sector
10:42into a $100 billion economic engine
10:44by 2030.
10:46The real test is turning viral success
10:48into viable businesses
10:49and individual stars
10:50into an industry
10:51creating sustainable work
10:52for millions of young Africans.
10:56And with that,
10:57we've come to the end
10:58of this edition of Business Africa.
11:01For more business news
11:03and updates,
11:03stay tuned to African News
11:05or visit us online
11:06at africanews.com.
11:08See you soon.
