Africa’s richest man, Aliko Dangote, has signed a $400 million equipment agreement with Chinese construction machinery manufacturer XCMG to support the expansion of the Dangote Petroleum Refinery in Lagos.

The investment is aimed at increasing the refinery’s processing capacity from its current 650,000 barrels per day to about 1.4 million barrels per day over the next three years. If completed as planned, the expansion would rank the Lekki facility among the world’s largest refining complexes.

The refinery, which began commercial operations in 2024, currently supplies petrol, diesel and aviation fuel to the Nigerian market while exporting refined products to several African countries, Europe, the United States and Saudi Arabia. The planned expansion is expected to strengthen Nigeria’s position as a major producer and exporter of refined petroleum products.

The agreement also reflects China’s growing involvement in Africa’s industrial development, with Chinese companies increasingly supplying equipment for large-scale infrastructure and manufacturing projects across the continent.

The expansion comes as Dangote Refinery prepares to raise fresh capital ahead of a planned stock market listing. Earlier this month, the company sought about $1 billion through a private placement that valued the refinery at roughly $39.1 billion, with investor interest reportedly exceeding the target.

Despite the refinery’s progress, the expansion will face challenges, including securing adequate crude oil supplies, maintaining regulatory support and ensuring sustained export demand. The first phase of the project took more than a decade to complete due to funding, construction and supply constraints.

If successful, the next phase of the refinery’s development could significantly increase fuel production, strengthen Nigeria’s energy sector and reduce the country’s long-standing reliance on imported petroleum products.