Nigeria is set to redefine its position as a continental energy powerhouse with the announcement of a $50 billion investment to develop Africa’s second-largest oil refinery in Ondo State. Spearheaded by Backbone Infrastructure Nigeria Limited (BINL) in collaboration with NEFEX Holdings Limited of Canada, the refinery will boast a production capacity of 500,000 barrels per day, complementing Nigeria’s existing Dangote Refinery and further consolidating the nation’s influence in Africa’s oil refining sector.
This landmark project, situated in the Ilaje area of Ondo State, is expected not only to transform Nigeria’s refining landscape but also to contribute significantly to the continent’s energy security, domestic industrial development, and international trade footprint.
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According to a consortium statement reported by industry sources, the $50 billion investment programme tied to the proposed refinery and allied infrastructure is expected to directly create over 15,000 jobs during the construction phase, and approximately 5,000 permanent technical positions once operations commence.
The refinery represents one of the largest private-sector energy investments in West Africa. The joint venture agreement combines the expertise and financial capacity of BINL and NEFEX Holdings, leveraging global networks and partnerships with international financial institutions to secure multi-currency credit lines and liquidity support. NEFEX Petroline brings extensive experience in engineering, construction of ports and terminals, petrochemical trading, and project management, ensuring the project aligns with international standards in operations and infrastructure development.
The project is part of a broader $50 billion investment framework that includes the development of the 1,471-hectare Sunshine Free Trade Zone. This integrated approach will facilitate logistics, storage, distribution, and efficient management of petroleum products while creating a platform for additional industrial activity in the region.
Beyond refining, the project promises a significant socio-economic impact for Ondo State and Nigeria at large. The BINL refinery and Free Trade Zone will generate substantial employment opportunities, drive local infrastructure development, and stimulate growth in ancillary industries. BINL’s corporate social responsibility strategy emphasises education, local employment quotas, and infrastructure improvement, reflecting a commitment to sustainable community development.
Strategic Significance in Global Energy Dynamics
Nigeria’s oil industry is pivotal in both continental and global energy markets. According to the International Energy Agency (IEA, 2025), Africa’s refining capacity is limited compared to demand, forcing many nations to rely on imported refined products. By expanding domestic refining capacity through projects like the Ondo refinery, Nigeria will not only reduce dependence on imports but also position itself as an export hub for refined petroleum products across Africa and beyond.
The refinery aligns with broader international energy and trade frameworks, including the African Continental Free Trade Area (AfCFTA), by enabling competitive, regionally sourced petroleum products. The initiative also reflects growing private-sector participation in African energy infrastructure, a trend critical for mobilising capital and technical expertise from international markets.
A Multi-Dimensional Vision
The refinery project includes the construction of roads, storage tanks, loading bays, terminals, and handling equipment. Such infrastructure enhancements will streamline the supply chain, improve logistics efficiency, and strengthen national energy security by increasing local production of refined petroleum products.
Moreover, strategic partnerships are being explored with the Nigerian National Petroleum Company Limited (NNPC Ltd) to optimise operational synergies and ensure alignment with national energy policies. These collaborations reflect a model where private investment and state support converge to deliver large-scale infrastructure projects that benefit the economy, society, and energy market stability.
A Continental Milestone
With operations scheduled to commence following detailed planning and community engagement, the Ondo refinery is poised to become a transformative milestone in Africa’s oil refining landscape. The project is expected to reshape the socio-economic fabric of Ondo State, enhance Nigeria’s energy self-sufficiency, and strengthen its position as a continental leader in petroleum production and refining.
As global energy markets adapt to shifting demand patterns and the urgent transition to sustainable energy, investments such as the Ondo refinery demonstrate Africa’s capacity to attract international capital, build modern infrastructure, and assert influence in global energy dynamics. The refinery is not merely a national project; it is a continental statement of ambition, capability, and the transformative potential of strategic investment in Africa’s industrial future.
