Standard Chartered has co-ordinated a US$3.3bn loan agreement between 12 local and international banks and Dangote Industries to develop the largest petroleum refinery in Nigeria.

Other participating banks are Access Bank, Zenith Bank, Ecobank Nigeria, Fidelity Bank, First Bank of Nigeria, Standard Bank of South Africa, UBA, First Rand Bank, First City Monument Bank and Diamond Bank.

Dangote Industries, which was founded by Aliko Dangote, labelled by Forbes as Africa’s richest man in 2013, will provide US$3bn in equity and intends to secure US$2.7bn more in loan capital.

The refinery, and its associated fertiliser and petrochemical plants, will produce 400,000 barrels of crude oil per day and 2.8mn tonnes of urea per year as well as an as yet undefined quantity of polypropylene and is expected to be completed in 2016.

CEO of Standard Chartered Nigeria, Bola Adesola, describes the project to GTR as “a milestone project for Nigeria, and Africa as a whole. This project will generate significant and sustainable economic benefits, such as cutting Nigeria’s current fuel product imports by half, creating employment for thousands of Nigerians – through direct and indirect employment – and increasing local specialist skills in key growth sectors”.

Despite having vast oil reserves, Nigeria has to import large amounts of its fuel needs because of its lack of refineries. The new refinery is targeted at ending this reliance on imports.

In turn the fertiliser production will negate the need for fertiliser imports and Dangote hopes to satisfy Nigeria’s domestic needs and begin exporting urea around West Africa.

“As a result [of the development], several African nations will be less reliant on importing fuel and fertiliser from foreign markets, reducing the negative impact of negotiating terms within increasingly turbulent international markets,” says Dangote.

Standard Chartered’s involvement could continue, Adesolda says: “We will continue to partner the group now and in future on their Pan-African expansion agenda and will keep deploying our products and expertise to drive the group’s long term strategic objectives.”