Dangote Refinery Engages in Promising Talks with Petroleum Marketers to Streamline Petrol Loading and Pricing

The Dangote Refinery and the Independent Petroleum Marketers Association of Nigeria (IPMAN) and the Petroleum Retail Outlet Owners Association of Nigeria (PETROAN) are set to hold high-level meetings from Tuesday to Wednesday. The focus of the discussions is finalizing agreements on the cost and logistics for lifting petrol from the Dangote refinery based in Lekki, Lagos. As the largest refinery in Africa, Dangote’s operations are expected to play a significant role in stabilizing Nigeria’s fuel supply and pricing.

This anticipated meeting comes after the Federal Government’s recent policy shift allowing petroleum marketers to lift petrol directly from local refineries, bypassing the Nigerian National Petroleum Company (NNPC) as an intermediary. This move is expected to introduce competition into the downstream sector, which could drive down the price of petrol in the coming weeks.

IPMAN and PETROAN Prepare for New Business Model with Dangote Refinery

Ahead of the scheduled meetings, the Independent Petroleum Marketers Association of Nigeria has expressed readiness to establish a long-term business relationship with Dangote Refinery. IPMAN’s National Publicity Secretary, Chinedu Ukadike, revealed that the association has significantly enhanced its storage capacity by acquiring tank farms, which would allow for the smooth distribution of petroleum products from Dangote’s facility to independent marketers.

Ukadike, during an interview on Arise TV, highlighted that IPMAN’s efforts are crucial to the stability of Nigeria’s fuel distribution network. He reassured stakeholders that once Dangote provides a pricing template, IPMAN is fully prepared to engage in the distribution of petrol from the refinery. “We are not afraid of the competition; we are ready to compete and contribute to lowering petrol prices,” Ukadike emphasized. The potential entry of more players into the distribution chain could lead to increased supply and competition, which could help reduce fuel prices across the country.

PETROAN Seeks Direct Lifting, Optimistic About Price Reduction

The Petroleum Retail Outlet Owners Association of Nigeria (PETROAN) has also expressed optimism about the upcoming negotiations with Dangote Refinery. According to PETROAN President Billy Gillis-Harry, the group is eager to establish direct business ties with the refinery. He revealed that PETROAN has already resubmitted its request for petrol lifting and is expecting a meeting with Dangote officials this week.

Gillis-Harry further speculated that petrol prices could significantly drop in the coming months, potentially to as low as N700 per liter, depending on market conditions. He attributed this potential reduction to increased competition and supply in the market. “If there’s massive supply, marketers will be forced to lower their profit margins, which will benefit consumers,” Gillis-Harry stated. The development signals a positive shift in Nigeria’s downstream oil sector, with both IPMAN and PETROAN positioning themselves for a new era of deregulated fuel marketing.

Deregulation and Bulk Purchase License to Boost Market Competition

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has also played a critical role in enabling independent marketers to engage directly with Dangote Refinery. According to IPMAN, the NMDPRA recently issued bulk purchase licenses to independent marketers, allowing them to lift petroleum products directly from the refinery. This move is expected to foster healthy competition in the downstream sector, with more marketers having direct access to fuel supplies.

Ukadike of IPMAN welcomed the bulk purchase license and hinted at ongoing discussions for an import license, which could further diversify Nigeria’s petrol supply chain. However, he raised concerns about the high cost of petrol, currently pegged at N1,040 per liter. He called on the government to create an energy bank to provide financial support for marketers, who are struggling with high-interest rates that drive up fuel prices. The collaboration between independent marketers and Dangote Refinery, coupled with regulatory support, is seen as a significant step toward addressing Nigeria’s long-standing fuel supply challenges.