The Dangote Petroleum Refinery has expanded its free petroleum products delivery programme to Kano, Imo, Anambra and Nasarawa states, with the aim of reducing distribution expenses for independent petroleum marketers and creating room for cheaper petrol at the pumps.
The Punch reported that the initiative, according to the refinery, was previously available in Lagos, Ogun, Rivers, Kaduna, Abuja and Delta states.
It is designed to move petroleum products closer to marketers and retailers while eliminating the cost of transporting products over long distances from the refinery.
By taking responsibility for delivery expenses, the refinery said it was removing a significant cost from the downstream distribution chain.
Group Executive Director, Commercial Operations, Oil & Gas, WAEP and Fertiliser, Dangote Industries Limited, Fatima Aliko Dangote, said the initiative was intended to ensure that the benefits of local refining reach 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.”
The Independent Petroleum Marketers Association of Nigeria welcomed the expansion, saying it could ease some of the financial and logistical difficulties faced by independent marketers and potentially translate into lower prices for consumers.
IPMAN National Publicity Secretary and Public Relations Officer, Chinedu Ukadike, said the arrangement tackled a persistent problem in the petroleum distribution system, where marketers often commit substantial funds to purchasing products and 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. 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,” he stated.
Ukadike added that the arrangement would shorten the period marketers’ money remains tied up, improve their cash flow and enable them to use their capital more efficiently.
The refinery noted that the savings would be particularly important for marketers serving locations far from the facility, where long-distance transportation adds costs related to haulage, vehicle operations, drivers, insurance, road risks and other logistics.
According to Dangote, cutting these expenses could make it more economical for marketers to serve distant markets while giving them greater flexibility to compete on retail prices.
The initiative is also expected to reduce operational risks linked to the transportation of large volumes of petroleum products over long distances by bringing supplies closer to their destination markets.
The latest expansion comes amid ongoing changes in Nigeria’s downstream petroleum industry, as rising domestic refining capacity contributes to a more competitive market.
The Dangote refinery has a refining capacity of 700,000 barrels per day and has been supplying refined petroleum products to the Nigerian market while increasing its activities in international markets.
