Depot and petroleum products marketers have raised concerns over supply bottlenecks and restrictive pricing models at the Dangote Refinery, threatening the viability of private sector players in Nigeria’s downstream sector.
Speaking at the West African Refined Products Pricing and Market Development Conference in Abuja, Olufemi Adewole, Executive Secretary of the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN), described the refinery’s distribution framework as exclusionary and incompatible with Nigeria’s fuel logistics landscape.
“Since the advent of Dangote Refinery, it has not been smooth sailing,” Adewole said. “Despite initial promises, we’re not getting product access or pricing clarity. The model appears selective and restrictive.”
Access Barriers and Gantry Constraints
According to Adewole, Dangote Refinery limits bulk access to a preferred few, while imposing a gantry-only loading model, which he says is operationally impractical for marketers with nationwide retail networks.
DAPPMAN, with 32 member depots and over 2 million metric tonnes in storage capacity, relies heavily on coastal vessel deliveries to serve stations across Nigeria efficiently. However, Dangote has withheld marine-based (coastal) loading for general marketers while favouring a closed list of preferred partners.
“You can’t tell a marketer with 400 retail outlets across the country to load trucks from Lekki. It’s not logistically sustainable, and it degrades the gantry infrastructure fast,” Adewole warned.
Opaque Pricing, PFI Bottlenecks
DAPPMAN also criticised the refinery’s pricing approach. Prices are reportedly not disclosed upfront but only provided after issuance of a Pro Forma Invoice (PFI), often to a select few.
“We registered for product offtake but didn’t receive any transparent pricing terms. For a liberalised market, this approach contradicts open access principles,” he said.
He noted that Dangote has suspended coastal lifting for most independent marketers, while granting marine deliveries exclusively to selected traders—widening the gap in market access and disrupting price parity.
FX Burden Versus Local Supply Advantage
Despite these issues, DAPPMAN reiterated that it prefers sourcing from Dangote in naira, which eliminates forex risk and supports national energy security. However, current supply limitations force many marketers to import from Lome or Europe, where prices are often more competitive even after factoring in forex pressures.
“The PIA gives us the right to import, but our first preference remains domestic supply. However, if it’s cheaper abroad, we’ll go there,” Adewole added.
Call for Regulatory Oversight
Both DAPPMAN and the Major Energies Marketers Association of Nigeria (MEMAN) called on the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to enforce competitive fairness. MEMAN’s Executive Secretary, Clement Isong, warned against allowing a single dominant player to skew the market.
“When there’s only one player, you no longer have a market. That’s a monopoly, and the regulator must act,” Isong said.
As Nigeria continues to transition from subsidy to deregulation, marketers insist that access parity, pricing transparency, and logistics flexibility are essential to building a resilient, competitive downstream market.