Nigeria's Dangote partners with China’s XCMG on petchemicals, green energy

Nigeria's Dangote Group has enlisted Chinese construction company XCMG to collaborate on petrochemicals, mining, and green energy innovations as it seeks to expand in the African market.

Dangote said in a late Jan. 30 statement that its strategic partnership with the state-backed XCMG would help it develop equipment and service solutions for projects including petrochemicals, open pit mining, agricultural processing, and building materials. XCMG will also provide Dangote with "new energy technologies" to support the sustainability of its operations, the statement said, announcing plans to jointly develop electric equipment and reduce its operating costs.

The Lagos-headquartered Dangote Group, founded by the richest man in Africa, is active in oil refining, petrochemicals, fertilizers, and sugar, having initially made its name in the cement business. In 2024, it started operating the largest refinery in Africa, while recent large-scale projects have included developing a new seaport in Nigeria's Ogun state and constructing a major oil pipeline from Namibia to Zimbabwe.

Support from XCMG, which specializes in heavy trucks, construction, and mining machinery, will involve providing logistical assistance and dedicated teams to Dangote, in exchange for preferential consideration as a future project partner. "The deal reflects Dangote Group's broader push to deepen industrial capacity across Africa through strategic global partnerships, while aligning with XCMG's ambition to expand its footprint and service offering on the continent," the statement said.

The new partnership follows a recent push by the Nigerian business to secure new partnerships as it embarks on major capacity expansions across refining, chemicals, and fertilizers, both domestically and abroad. In the petrochemicals sector, the company plans to grow its polypropylene capacity from 830,000 metric tons a year to 2.4 million mt/year by 2028, while president and founder Aliko Dangote has hinted at plans to develop a footprint in China.

"Our business concept is going to change. Now, instead of being 100% Dangote-owned, we'll have other partners," he said in an October interview with Platts, part of S&P Global Energy.

Petrochemicals progress

Expanding in petrochemicals has been a key objective for Dangote, which aims to capture the nascent Nigerian market and offset imports that come mostly from the Middle East.

The Dangote petrochemicals complex, which began trial operations in March 2025, is already the largest in Africa, although the facility remains in ramp-up mode, according to local polypropylene traders.

The Nigerian facility typically faces steep competition from suppliers in China, the US, and Middle East, although poor arbitrage economics and a string of global refinery turnarounds have suppressed recent arrivals during a period of seasonally high demand ahead of crop season, Platts has reported.

A statement from XCMG showed photos of Aliko Dangote and his team meeting with Chairman Yang Dongsheng at one of its Chinese facilities. The statement said the Nigerian businessman praised the company's strong presence in the international marketplace on the eve of the new partnership agreement.

In January, Dangote previously signed a $350 million contract with India's Engineers India Ltd. to support its refinery expansion, which it is seeking to finance with $5 billion of new funding from the African Export-Import Bank and an upcoming IPO. It also previously agreed a memorandum of understanding with Japan's Mitsui Chemicals to support its petrochemicals expansion and provide technology in the fertilizers segment.

Platts assessed polypropylene raffia CFR West Africa at $870/barrel Jan. 29, up $20 week over week and 5% month over month.