PETROAN, Azikel Refinery Explore Offtake Pact To Boost Products Availability

Petroleum products retailers and the Azikel Refinery have opened discussions on a structured offtake partnership aimed at securing direct access to locally refined fuels and improving the availability of petroleum products across Nigeria.

The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), national executives, led by national president Dr Billy Sotubo Gillis-Harry, visited the 25,000 barrels-per-day Azikel Refinery at Obunagha, Yenagoa, Bayelsa State, to assess the facility’s readiness for commercial operations and negotiate terms under which its members could purchase Premium Motor Spirit, diesel, kerosene, aviation fuel and LPG directly from the indigenous plant.

The association said the visit was part of its ongoing industry oversight and stakeholder engagement, with three main objectives: to assess emerging domestic refining capacity first-hand; to open structured dialogue with an indigenous refiner on practical collaboration terms; and to identify commercially viable arrangements that can improve the availability, reliability and distribution of locally refined products to Nigerian consumers.

During the visit, the delegation received a detailed presentation on Azikel Refinery’s development history, operational planning, refining capacity, product slate and possible partnership avenues with the retail segment of the value chain.

Central to the discussions was a proposed structured offtake arrangement under which PETROAN members would access petroleum products directly from the refinery on mutually agreed commercial, technical and operational terms.

PETROAN stressed that such an arrangement would compress Nigeria’s traditionally long and often opaque downstream supply chains, which are filled with intermediaries, uncertainty and added cost. A direct relationship between domestic refiners and organised retailers would give refiners a predictable, aggregated market for their output, while giving retailers a more dependable source of supply insulated, to a meaningful degree, from international product market volatility and foreign exchange swings, the association said.

Azikel Refinery has been re-engineered from its original design capacity of 12,000 barrels per day (bpd) to a 25,000 bpd full-slate hydro-skimming facility configured to process crude oil and condensate into Premium Motor Spirit (petrol), automotive gas oil (diesel), kerosene, aviation turbine fuel and liquefied petroleum gas (LPG).

Recent reports indicate the project has entered an advanced stage of construction and integration following the arrival and installation of its 200-tonne Crude Distillation Unit (CDU), a key milestone toward commissioning. The refinery, valued at about $1 billion, is being developed by the Azikel Group under Dr Eruani Azibapu Godbless.

PETROAN described the emergence of facilities like Azikel as a structural rather than incidental development, arguing that each additional domestic refinery broadens the national supply base, introduces competition among suppliers and strengthens the resilience of a downstream sector long exposed to external shocks.

Speaking during the engagement, Dr Gillis-Harry reaffirmed PETROAN’s commitment to working with indigenous refiners to build a sustainable and commercially sound domestic petroleum products supply chain.

“As retailers, we want to build practical partnerships with indigenous refineries that can improve product availability, strengthen supply chains and create greater certainty for businesses and consumers,” he said. He added that PETROAN’s objective is not merely to secure supply for its members, but to establish enduring commercial relationships that are equitable and beneficial to refiners and marketers alike.

In his response, Azikel Group president and CEO Dr Eruani Azibapu Godbless welcomed the PETROAN delegation and affirmed the refinery’s readiness to build strategic relationships with petroleum products retailers as the facility advances toward commercial operations.

He underscored that collaboration between refiners and retail outlet owners is indispensable to efficient distribution and to securing market access for locally refined products. Both parties agreed on the need for sustained engagement to resolve the commercial, technical and operational requirements on which the proposed offtake partnership will depend.

PETROAN said its engagement with Azikel is one element of a wider strategy to deepen collaboration with indigenous refineries and stakeholders across the entire downstream value chain.

The association warned recently against concentration of supply in any single source, however large, saying diversity of supply is the surest guarantee of both competition and security. It cited emerging projects such as the 25,000 bpd Azikel Refinery in Bayelsa and other planned facilities as evidence of growing domestic refining capacity that could help create more market-based pricing and improve consumer access to affordable products.

“As projects such as Azikel move from ambition to operation, PETROAN remains committed to supporting every credible initiative that expands domestic refining capacity, improves product availability, strengthens competition, and contributes to a more stable, sustainable and self-reliant petroleum products market for Nigeria,” the association said in a statement signed by national PRO Dr Joseph Obele and Investment and Insurance Directorate chairman Dr Donald Peterson.