Dangote takes free fuel delivery to four more states
•Kano, Imo, Anambra, Nasarawa join initiative
•IPMAN backs move to cut distribution costs
•As PETROAN urges Rivers Gov’t to accelerate CNG adoption to reduce transport costs
Dangote Petroleum Refinery & Petrochemicals has extended its free petroleum product delivery initiative to Kano, Imo, Anambra and Nasarawa States, a move expected to cut distribution costs for independent petroleum marketers and create greater room for lower petrol prices at filling stations.
The initiative, which initially covered Lagos, Ogun, Rivers, Kaduna, Abuja and Delta States, is intended to bring petroleum products closer to marketers and retailers while reducing the expense of transporting products over long distances from the refinery to different parts of the country.
By absorbing delivery costs, the refinery is taking on a major expense within the downstream distribution chain, potentially allowing marketers to retain more of their working capital while giving them greater flexibility to review pump prices.
Group Executive Director, Commercial Operations, Oil & Gas, WAEP and Fertiliser, Fatima Aliko Dangote, said the initiative was aimed at ensuring that the gains from domestic refining translate into measurable savings for businesses and consumers.
“The value of domestic refining must ultimately be felt beyond the refinery gate. By absorbing the cost of delivering petroleum products to our customers, we are removing a significant component of the distribution burden and creating room for those savings to flow through the value chain to consumers. Our goal is to make fuel distribution more efficient, reduce avoidable costs and support more competitive pump prices across Nigeria,” she said.
The expansion has received the backing of the Independent Petroleum Marketers Association of Nigeria (IPMAN), which said the arrangement could ease some of the financial and logistical pressures faced by independent marketers while contributing to lower prices for consumers.
National Publicity Secretary and Public Relations Officer of IPMAN, Chinedu Ukadike, said the initiative tackles a longstanding problem in the distribution of petroleum products, where marketers commit substantial funds to purchasing products and can subsequently wait for days or weeks before their orders are loaded and transported.
“This gesture, if sustained, will be able to alleviate the sufferings of independent marketers,” Ukadike said. “There has been the issue of financial hold-up, whereby marketers pay for products and are not loaded for days and weeks, and they suffer unnecessary hardship bringing the product down.”
According to him, Dangote Refinery’s delivery arrangement shortens the period during which marketers’ funds remain tied up, improves their cash flow and enables them to put their capital to more productive use.
“This time around, Dangote has made it very, very easy for marketers. Marketers are jubilating, and you will see the return on investment as an independent marketer. Your money will not be tied down,” he said.
Ukadike also linked the reduction in transportation costs to the possibility of lower pump prices, noting that the cost of moving petroleum products is ultimately reflected in the price consumers pay.
“You also have less risk, and you have petroleum products at your doorstep. Other consumers will also see that our pump price will not continue to go up. The more Dangote brings down its pump price, the more independent marketers will bring down theirs,” he said.
The cost savings could be particularly important for marketers supplying areas located far from the refinery. Under conventional distribution arrangements, transporting petroleum products across long distances attracts additional expenses covering haulage, vehicle operations, drivers’ costs, insurance, road risks and other logistics.
Removing or reducing these expenses can improve the viability of supplying distant markets and give marketers greater scope to compete on retail prices.
The initiative could also reduce some of the operational risks associated with transporting large volumes of petroleum products over long distances. Moving products closer to their destination markets shortens the supply chain and could improve the reliability and efficiency of distribution.
Ukadike commended the management of Dangote Refinery for introducing the initiative and called for its extension to more locations across the country, particularly in the northern states, to widen access to competitively priced petroleum products.
He described the development as a practical demonstration of the benefits of competition and deregulation in Nigeria’s downstream petroleum sector.
“This is the beauty of deregulation and competition,” he said.
The expansion comes as Nigeria’s downstream petroleum industry continues to adjust to increased domestic refining capacity and a more competitive market environment.
Dangote Petroleum Refinery, which has a stated capacity of 700,000 barrels per day, has become an increasingly important supplier of refined petroleum products to the domestic market while also expanding its presence in international markets.
The free delivery programme adds another dimension to the refinery’s growing role in the downstream sector. Beyond increasing the domestic availability of refined products, the initiative seeks to reduce the cost of moving those products from the refinery to markets across the country.
For motorists and households, the potential impact is direct. Where the cost of transporting petrol through the supply chain falls, marketers have greater opportunity to reduce the amount consumers pay at the pump, particularly in locations where logistics have traditionally added substantially to the final price.
Meanwhile, the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has called on the Rivers State Government to urgently develop a comprehensive Compressed Natural Gas (CNG) programme to reduce transportation costs, attract investment, and harness the state’s vast natural gas reserves.
The call was made by PETROAN National President, Dr. Billy Gillis-Harry, while speaking to journalists in Lagos during an inspection of CNG refuelling locations. Gillis-Harry emphasised that Rivers State holds a unique strategic advantage as one of Nigeria’s premier hydrocarbon hubs, positioning it to evolve from a simple producer into a thriving domestic gas economy.
In a statement signed by Mr. Chris Odia, the association reaffirmed its readiness to partner with the Rivers State Government, federal agencies under the Presidential Initiative on CNG and Electric Vehicles (Pi-CNG & EV), and private stakeholders to deliver affordable, lower-emission transport across the state.
He noted that the state should study and adapt the emerging CNG model being implemented in Lagos State, tailoring it specifically to its own industrial base, transportation needs, and energy resources.
To drive this transition, PETROAN proposed the establishment of a Rivers State CNG Conversion and Transportation Programme.
The initiative recommends deploying conversion centres across major transport corridors, rolling out refuelling infrastructure in partnership with private gas investors, and integrating CNG buses into the public transport network.
The association also urged the gradual adoption of gas-powered vehicles across government ministries, departments, and agencies, alongside affordable financing packages to assist commercial drivers in retrofitting high-mileage buses and taxis.
PETROAN further highlighted that the shift toward gas represents a major opportunity rather than a threat to the downstream petroleum sector.
Retail marketers can actively participate in the energy transition by transforming existing filling stations into multi-energy hubs dispensing petrol, diesel, and CNG.