Divergent views are emerging from petroleum products marketers after Dangote Petroleum Refinery announced plans to begin a significant national initiative designed to transform Nigeria’s fuel distribution landscape.
The company’s management said, effective 15th of August 2025, the Refinery will begin the distribution of Premium Motor Spirit (PMS) known as petrol and diesel to marketers, petrol dealers, manufacturers, telecoms firms, aviation, and other large users across the country, with free logistics to boost distribution network.
According to the company, to ensure smooth take-off of this scheme, Dangote Refinery has invested in the procurement of 4,000 brand-new Compressed Natural Gas (CNG)-powered tankers. This phase of the programme will continue over an extended timeframe. The refinery is also investing in Compressed Natural Gas (CNG) stations, commonly referred.
But in a swift reaction, the Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN) raised concerns about Dangote Refinery’s forward integration adoption, warning that, it could lead to a monopoly in disguise and pose a significant job loss threat to Nigeria.
The association said that with a production capacity of 650,000 barrels per day, PETROAN argued that Dangote Refinery should be competing with global refineries, not operating as a distributor in the downstream sector.
This massive refinery, one of the largest in sub-Saharan Africa, is expected to satisfy domestic fuel demand and export surplus products.
PETROAN has previously raised alarms about Dangote’s intentions to dominate the downstream sector, citing concerns that the company may leverage its market power to fix prices, limit competition, and exploit consumers, much like it has done in other sectors.
PETROAN warns that Dangote’s tactics may include a pricing penetration strategy, where they reduce prices to capture market share, with the ultimate goal of forcing other filling station operators to quit the market. This, they said, could lead to a massive shutdown of filling stations across Nigeria, resulting in widespread job losses.
However, speaking to LEADERSHIP, the Board of Trustees (BoT) Treasurer of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Elder Chinedu Okoronkwo said, the initiative will engender discipline in the distribution chain and ensure steady and uninterrupted supply across the country.
Okoronkwo, though admitted that it could negatively affect the National Association of Road Transport Owners (NARTO) whose members actively participate in the distribution system, said, the development will go further to address incessant strike actions by Petroleum Tanker Drivers (PTD).
He opined that, it will significantly address scarcity often created when tanker drivers down tools in agitation that could ordinarily be resolved.
“I have always advocated for downstream market stability and peaceful resolution of disagreements because any disruptions in energy distribution usually come with economic consequences. I am not against unionism or groups seeking redress through strike action but that should always be the last resort rather than provoking national security concerns through such avoidable decisions,” he stressed.
Dangote, on its part said, the strategic programme is part of the refinery’s broader commitment to eliminating logistics costs, enhancing energy efficiency, promoting sustainability, and supporting Nigeria’s economic development. It affirmed management’s dedication to improving the availability and affordability of fuel, in support of broader efforts to strengthen the economy and improve the well-being of all Nigerians.
On its part, the Major Energy Marketers Association of Nigeria (MEMAN) has expressed concern that a huge opportunity strain exists in the Compressed Natural Gas (CNG) energy market and sought for direct investment in conversion infrastructure to support the project. The marketers also called for open market competition in the downstream sector.
Speaking at MEMAN’s quarterly webinar, with the theme ‘Fair and Healthy Competition in the Nigerian Market,’ the association’s chief executive officer, Clement Isong said, several MEMAN members are transitioning from diesel to CNG trucks in line with the government’s cleaner energy drive.
However, he warned that the policy remains in early stages and infrastructure gaps must be addressed, adding that CNG is still a developing policy. Infrastructure is lacking, so coordinated planning is vital.
Meanwhile, industry experts have analysed the initiative, saying it will potentially reduce inflation, create thousands of jobs, and lower the cost of petroleum products across Nigeria.
A university lecturer and public affairs analyst, Dr Abimbola Oyarinu 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.
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.
