Dangote Refinery’s Direct Product Supply: Marketers Warn Of Monopoly, Job Losses

The Natural Oil & Gas Suppliers Association of Nigeria (NOGASA) has expressed strong opposition to Dangote Refinery’s plan to directly supply petroleum products to end users, warning that the move could trigger a monopoly and lead to significant job losses across the oil and gas sector.

NOGASA’s president, Benneth Korie, voiced concerns that this move could significantly disrupt the oil and gas industry, putting thousands of jobs at risk and jeopardising the existing business models of suppliers nationwide.

Dangote Refinery recently announced it would begin direct distribution of Premium Motor Spirit (PMS) and diesel to marketers, petrol dealers, manufacturers, telecom companies, aviation firms, and other large consumers starting August 15, 2025. This strategy involves deploying 4,000 new Compressed Natural Gas (CNG)-powered tankers to bypass traditional depots and intermediaries in the supply chain.

NOGASA President Benneth Korie emphasised that this direct supply model threatens to disrupt the existing distribution network. Suppliers, who have traditionally acted as intermediaries between refineries and end users, fear losing their roles, putting thousands of jobs at risk nationwide. Korie described the initiative as a “new trend” that excludes suppliers and could make them obsolete, particularly impacting companies servicing major clients like telecom giants and hotels.

The Natural Oil & Gas Suppliers Association of Nigeria (NOGASA) has raised strong objections to the recent plan by Dangote Refinery to supply petroleum products directly to end users, bypassing the traditional distribution chain.

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According to Korie, Dangote’s decision to supply products directly to large organisations, such as telecommunications giants and hotels, marks a notable shift in the sector.

Members of NOGASA, who  serve as intermediaries between refineries and final consumers, fear that this new distribution model will render their roles obsolete.

“This is the new trend in the oil and gas industry, where Dangote is now supplying products directly to end users, especially MTN, companies, hotels, and all the rest of them. Members of NOGASA are suppliers of petroleum products.

By doing so, a lot of jobs are at stake and we are kicking against this new way of supplying products to end users,” Korie stated.

Korie elaborated on the potential consequences, highlighting that many NOGASA members and their employees could lose their jobs. The redundancy of trucks, drivers, and other logistical staff looms as a direct result of the bypassed supply chain. This, according to the association, would have a ripple effect not just on the livelihoods of their members, but also on the  Nigerian economy.

“It will remove jobs from a lot of them and some of our staff will be redundant, some of our trucks will be redundant,” Korie warned.

He said NOGASA has scheduled a general meeting on July 31 at Chida Hotels, Abuja. The agenda will focus on developing a unified strategy to address the issue, including the possibility of downing tools and direct engagement with Dangote to seek a resolution.

The association is seeking to advocate for a distribution structure where Dangote supplies products to NOGASA members, who will then sell to the end users, preserving jobs within the supply chain.

“We are holding a general meeting on 31st, to decide whether to down tools and to find a way to ensure that Dangote will supply the product to us rather than supply to the end users. And we will in turn supply to the end users. These are chains of distribution,” Korie explained.

NOGASA insists that bypassing the traditional distribution mechanism is “not healthy for the oil and gas industry” and poses risks to its stability. The association is calling on all stakeholders to recognise the vital role that suppliers play—not only in logistics but also in maintaining a balanced industry ecosystem.

“We are holding a meeting on 31st of July at Chida Hotels to have a resolution and meet up with Dangote to ensure that they will have a relationship where Dangote should not supply products to end users,” Korie stated.