The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has expressed grave concerns regarding the imminent entry of Dangote Refinery into the distribution of petrol and diesel.
The association has cautioned that this move has the potential to reshape Nigeria’s downstream sector, which could result in the loss of jobs and the closure of small businesses.
What’s Happening
- Beginning August 15, 2025, Dangote Petroleum Refinery intends to commence direct distribution of fuel through the use of 4,000 brand-new CNG-powered tankers. This will allow the refinery to circumvent the competition from regular depots and transportation channels.
- The refinery is of the opinion that this will result in lower costs associated with logistics and improved efficiency in the national fuel supply.
PETROAN’s Concerns
- Independent gasoline marketers could be rendered obsolete as a result of Dangote’s policy, which would lead to widespread layoffs of station employees and truck drivers.
- There is a possibility that the implementation of CNG tankers may render thousands of conventional transports obsolete.
- Dangote is accused by PETROAN of using its refinery capacity of 650,000 barrels per day to intimidate smaller businesses, thereby putting up the possibility of monopolization in the downstream industry.
Consequently, the National President of PETROAN, Billy Gillis Harry, requested the Executive Director of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Minister of State for Petroleum to put in place pricing control measures to prevent any type of monopoly.
“PETROAN expressed concern about Dangote Refinery’s forward integration adoption, warning that it could result in a monopoly in disguise and pose a significant job loss threat to Nigeria.”
“With a production capacity of 650,000 barrels per day, PETROAN believes Dangote Refinery should compete with major refineries rather than serving as a downstream distributor. This gigantic refinery, one of the largest in Sub-Saharan Africa, is projected to meet domestic gasoline demand while exporting surplus products.
“PETROAN has already expressed worries about Dangote’s aspirations to dominate the downstream industry, expressing fears that the corporation will use its market clout to regulate prices, limit competition, and exploit consumers, as it has done in other sectors.
“PETROAN warns that Dangote’s tactics may include a pricing penetration strategy, in which they lower prices to gain market share, with the eventual goal of driving other filling station operators to exit the market. This might result in a large shutdown of filling stations across Nigeria, causing severe job losses.
“Dangote Refinery’s introduction of 4,000 brand-new Compressed Natural Gas (CNG)-powered tankers poses a significant threat to the livelihoods of thousands of truck drivers and owners.” While CNG trucks may reduce the cost of transporting petroleum products, this transition could result in significant job losses in the industry.
“The implementation of a forward integration approach by Dangote Refinery will have a significant impact on different stakeholders, including:
Dangote’s supremacy may affect modular refineries’ operations and market share.
Truck owners should be aware that Dangote’s direct supply and CNG-powered tankers may result in job losses and limited business opportunities.
Filling Station Operators: Many may be forced to close owing to Dangote’s pricing penetration strategy and dominance.
Local suppliers of petroleum products: Dangote’s direct delivery to end customers may have a negative influence on their enterprises.
Dangote’s dominance may pose a threat to telecom diesel suppliers’ operations and market share.
“It is evident that Dangote intends to obtain a complete monopoly over the downstream industry, allowing the corporation to exploit Nigeria’s petroleum consumers.
“Dr. Billy Gillis Harry, the National President of PETROAN, calls on the Executive Director of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Minister of State for Petroleum to implement pricing control measures to prevent any type of monopoly. According to the Daily Post, Dr. Harry emphasizes the importance of competition in protecting consumers and promoting economic efficiency,” the statement states.
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