Ebun Sessou & Dolapo Majekodunmi
Mr. Segun Adebutu is the Chairman of Petrolex Oil and Gas. Born into the family of Chief Kesington Adebukunola Adebutu, Chairman, Premier Lotto Nigeria Limited (fondly called Baba Ijebu), Segun is building the second largest refinery in Sub-Saharan Africa. In this interview, he speaks on how he started the multi-billion dollar oil company with 50 litres of petrol he sold to his father and family friends.
You signed a deal to build the biggest petroleum depot in the country in partnership with the government of Ogun State. How did it happen?
Your claim is slightly correct. Ogun State witnessed the signing of the transaction which wasn’t the building of depot. The depot has been commissioned and at the time I was with Governor Ibikunle Amosun and some state government officials, the meeting was to reintroduce partners assigned to build the second phase of the project which is the refinery. The depot project started four and a half years ago and commissioned in December 12, 2017, which marked the end of the first phase. The depot is a three hundred million – litre capacity tank farm. Cargoes are already coming in and we have started selling to the public since the end of March. The project is in three phases with the depot being the first. The second phase is the pipeline and the third phase is the refinery.
The second and third phases are running concurrently. As we speak, we have completed the engineering work for the pipeline and collected all relevant permits and we will start the construction of the pipeline in May to be completed by Q3 next year. The refinery is expected to be completed by Q4 2021/ Q1 2022. It is a 250,000 barrel-a-day refinery. It will provide significant amount of refined products which include petrol (PMS), diesel (AGO) and kerosene (DPK) for the country. The company plans to spend $3.6 billion on the project and it is already working on the front-end engineering design. The point I am making is that there are plans to inaugurate a storage-tank farm, other mid-stream infrastructure and start the refinery. The tanks are connected to a pipeline in Mosimi which will distribute products across the country.
Tell us how you came about all of this?
My oil and gas story started with the selling of 50 litres of fuel. From there, I went to 5, 000 litres. I was selling to my father and family friends, including the Okoyas, owners of factories and businesses. I gradually built a clientele and capacity; and, eventually, I invested in infrastructure because, when you build capacity, it will get to a point where you will have the advantage of economy of scale. Later I built the tank farm. I am now building the pipeline and I have started building petroleum stations as well. By 2022 when we expect the refinery to be commissioned, we are targeting to have 250 to 300 petroleum stations. That way, we are looking at the full value chain. And we have the objective of moving to the upstream sector so that our E and P will grow to refining and vertical integration.
So, the story is from 50 litres to where you are today?
What are the challenges?
Like in any other business, the challenges are enormous. First is the problem of funding which is usual with retail businesses, and then the challenges that come with the downturn in the economy. Up until recently, the exchange rate was erratic. You know we refine petroleum products abroad which is dollar based. And this does not relate to oil and gas alone. If you decide to open a restaurant, you should be ready to bear the operational expenses among other things so as to be able to pay salaries and do other things until the business stabilises and that is how it is.
So, how long has the business been in existence?
I started the oil and gas business in 2007. So we are in the 11th year. It did not just happen overnight.
You have also signed a memorandum with the Chinese Energy Engineering Corporation. What is the reason behind that move?
The refinery project underway and the Petrolex Mega-City require power. We estimate that we would need at least 200 megawatts of power; therefore, there was urgent need to bring in experts to provide electricity and partner them to build a power plant. That is the reason for the memorandum; to provide reliable power.
Tell us about Petrolex.
It is an integrated energy conglomerate that provides services across refining, storage, distribution and retailing of petroleum products. We are committed to a seamless execution of strategic investment plans to provide innovative energy solutions. The ultimate success lies not only in the profitability of our operations but also in excellent service delivery. The refinery project will be funded with loans from banks, international lenders and revenue from Petrolex. The company is also planning to build a fertilizer plant, lubricants facility and a liquefied petroleum gas plant. We hope to be listed on the Nigerian Stock Exchange in the next 10 years to ensure that the business outlives its owners and give room for expansion. In the next five years, we hope to have achieved a significant part of our ambition and then begin the process to be listed on the stock exchange. The company hopes to employ 10,000 people directly by 2021 when all the phases of the project will be up and running.
You wear several caps. You are into construction, oil and gas, entertainment, agriculture and real estate. We also know that you have a foundation. Does it not look like you are jack of all trades?
It is different if you say that I am into farming and I am also into oil and gas as well as construction. The entertainment part is actually not a core business. It is something I just like to do. To me, entertainment is not to make money. It is just a passion. It has been my hobby as a child. I was frequently ill as a child, music was what kept me. I was hospitalized for more than six months at a stretch. My mum would go home for a while; after some time, she would be back in hospital with me. My father was a businessman. Entertainment, I believe, can be structured better than it is now. Hopefully, when things improve, it might become as profitable as other businesses. But for now, it is a passion. The late MKO Abiola was a passionate supporter of football. He established Abiola Babes FC. In 1998, he said, in an interview, that, between 1981 and 1982, he spent N53million on the FC and generated only N1.5 million in ticket sales in return. Entertainment is not something I feel I should make money from, but just a way to give young people the opportunity to express themselves.
The foundation I set up is separate from the entertainment business. The foundation is meant to take care of less privileged children. In the first two and a half years of the foundation, I single-handedly bore all the expenses but other people have started coming on board now. Some people have identified with me while some people are saying I am using the foundation to get into politics. Meanwhile I have said it categorically that I am not interested in politics. There is a family member who is a politician and, I think, one politician is enough for the family. I think the question should be why are people not doing what would make other people have sense of belonging.
Message for Nigerians
I said it when I commissioned the Ibefun tank farm and I say it again that this country has everything it takes to become a world power. I pray that by the time I depart this world, Nigeria would have fulfilled her potentials. We have huge human and natural resources. Go to John Hopkins, Microsoft, all the big institutions that matter across the world and you find Nigerians there doing great things. Everywhere we go, we make impact; everywhere we go, we excel. We need to take ourselves seriously.
What is the relationship between you and your mum like?
She is the benchmark of everything that I am. My daughter takes after my mother. I am my mother’s last child. There was a time I was ill for several months and in coma for three and a half weeks; and my mother did not leave my sight. Doctors said I had only 30 per cent chance of surviving. My mother was there with me from the beginning to the end. She left all that she was doing and followed me to three different countries where I had about 16 different types of operations.
Tell us the memories you will never forget about her.
If I start now, I will never be able to say up to 30 per cent of her sweet memories till 2019. She is an incredible mother. I offer her as a benchmark not just for all mothers but also for all women.
It is believed that the boy-child is always close to the mum. Is that what is obtainable in your case?
I have two children: a daughter and a son and I cannot separate them. I call them my dynamic duo. They are the most incredible gifts God has ever given me and I can boast that they are the most incredible gift anybody could ever have.
Can you tell us your hobbies, birthday and the rest of them?
My birthday is May 4. I am an obsessive Chelsea supporter. I use the word obsessive because there is no better word. I chose the club because it brings me joy and I also take the sad moment and still love them. They are the best.
What are your likes and dislikes?
I like openness and transparency. I like the respect that comes with giving due respect to people.