Dangote Refinery’s Direct Petrol Distribution Yet To Begin

Despite the much-anticipated rollout of Dangote Refinery’s direct distribution of petrol and diesel, the initiative has not commenced as scheduled.

This is as key petroleum products marketers are poised for an emergency meeting amid mounting uncertainty over the commencement of Dangote Refinery’s much-anticipated direct distribution of fuel products.

Recall that Dangote Refinery had announced that from 15 August, the refinery’s would begin the direct delivery of petrol and diesel to filling stations, industrial facilities, and other high-volume consumers. According to a statement from the refinery, it aims to meet Nigeria’s daily consumption of 65 million litres of refined petroleum products.

However, checks by LEADERSHIP shows the exercise may not commenced as scheduled.

Efforts by our correspondent to get confirmation of the situation from Anthony Chiejina, spokesperson of the Dangote Industry Limited (DIL) did not yield results.

Chiejina, however, after persuasion called our correspondent to deny report of any meeting with marketers where it was discussed that the refinery will push products in bulk to the Nigerian Oil and Gas Suppliers Association (NOGASA).

He said the marketers were promoting false claims as the refinery is properly positioned to promote efficiency in the system.

He however kept mum on whether the exercise has actually commenced.

Some reports claimed that a meeting was held between Dangote and industry stakeholders to address potential disruptions and job displacement and that an agreement was reached where Dangote’s refinery will sell products in bulk to established distributors like NOGASA.

When contacted, the national public relations officer of the association, Chief Chinedu Ukadike, denied any meeting with marketers where Dangote agreed to deploy products to the association.

“Well as I speak with you, I cannot confirm that any meeting held and I have not taken note of any of our members receiving product under the circumstances where Dangote has distributed products from the direct distribution initiative as earlier announced.”.

However, he said that a stakeholder emergency meeting is being planned for today (Sunday) or Monday to consider the next line of action.

LEADERSHIP reports that many marketers and tanker drivers earlier raised concerned that the refinery’s projected bypass of established distribution methods would result in massive job losses and disrupt the national fuel supply chain.

To address these issues, the Dangote Group recently held a high-level meeting with major industry players, including the National Association of Road Transport Owners (NARTO) and the Natural Oil and Gas Suppliers Association of Nigeria, some reports claimed that.

Meanwhile, the Executive Secretary of the Major Energy Marketers Association of Nigeria (MEMAN) told our correspondent that he would not be in any position to confirm if the direct product distribution has started.

“I was not in the office yesterday and until Monday before I could confirm whether it has started or any of our members has taken delivery under the arrangement “.

LEADERSHIP reports that the refinery’s plan to deploy 4,000 new Compressed Natural Gas (CNG)-powered tankers is expected to not only address the country’s long-standing distribution inefficiencies but also reduce the influence of intermediaries and contribute to environmental sustainability.

Dr Abimbola Oyarinu, a university lecturer and public affairs analyst, stated that if successfully implemented, the policy could significantly reduce the power held by middlemen within the oil and gas distribution chain. He observed that these intermediaries, including tanker drivers, have historically held the sector, and sometimes even the state, to ransom.

“This initiative has the potential to dismantle the dominance of powerful middlemen, who have in the past stalled progress and held entities like the NNPCL hostage,” said Oyarinu. “However, Nigerians will judge it by its impact on fuel prices. If it leads to cheaper petrol at the pump, it will ease inflation considering fuel costs and exchange rates are key inflationary drivers in Nigeria.”

Ibukun Phillips, an energy analyst, described the move as “revolutionary”, stating that it could reshape Nigeria’s energy landscape by improving accessibility and affordability, especially in rural areas.

“Logistics currently account for between 10% and 30% of fuel prices,” she explained. “Eliminating this cost will naturally reduce pump prices. Rural dwellers often pay more for fuel than those in urban areas, despite earning less. This initiative could revive disused filling stations and ensure more equitable distribution.”

Phillips added that the scheme will also generate employment, with at least 8,000 drivers expected to be hired to kickstart the operation.

Speaking on a national television programme, energy expert and co-founder of Dairy Hills, Kelvin Emmanuel, said Dangote’s move to cover logistics costs marks a critical shift that could allow Nigerians to finally benefit from domestic refining. He argued that concerns about the refinery becoming a monopoly are misplaced, pointing instead to systemic inefficiencies that have plagued the sector for decades.

“People have valid concerns,” Emmanuel acknowledged. “But let’s be clear: the real business marketers have been involved in isn’t selling PMS with margins of N5 to N15. Their real gains have come from exploiting arbitrage opportunities, often with substandard imports that don’t meet the sulphur specifications outlined in the Petroleum Industry Act (PIA).”

He highlighted how logistical and regulatory failings have hampered fuel distribution.

“For instance, I can confirm that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) currently owes independent marketers N1.8 billion in outstanding bridging claims. Whether these claims are valid is another matter—an independent forensic audit would be required to determine that.”

According to Emmanuel, the Dangote Refinery is stepping in to address long-standing gaps in Nigeria’s fuel distribution system. He emphasised that fuel supply across the country remains inconsistent, with only Lagos, a few states in the southwest, and Abuja enjoying relatively stable and fair pump prices

“Dangote is taking on the burden of transportation, storage, and bridging costs that should have been streamlined long ago. This is in response to the resistance from vested interests who have tried to frustrate fair and efficient distribution,” he said.

He further explained that the refinery’s current reliance on road transport is a strategic move to bypass infrastructural and bureaucratic bottlenecks.

“The immediate fix is the deployment of CNG-powered trucks to ensure last-mile delivery while avoiding delays caused by existing structural inefficiencies,” Emmanuel added.