By Sabiu Abdullahi
The Dangote Petroleum Refinery has expanded its free petroleum products delivery programme to Kano, Imo, Anambra and Nasarawa states.
The refinery said the move would help independent petroleum marketers cut distribution expenses and create an opportunity for reduced petrol prices across the affected areas.
The initiative, according to a statement issued on Sunday, was initially introduced in Lagos, Ogun, Rivers, Kaduna, Abuja and Delta states. It is designed to bring refined products closer to marketers and retailers while reducing the expenses associated with transporting fuel over long distances.
The refinery said its decision to bear delivery costs would remove a major expense from the downstream petroleum distribution chain.
Group Executive Director, Commercial Operations, Oil & Gas, WAEP and Fertiliser, Dangote Industries Limited, Fatima Aliko Dangote, said the programme was intended to ensure that the benefits of local refining reached 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 would ease some of the financial and logistical difficulties faced by its members and potentially contribute to cheaper fuel for consumers.
The National Publicity Secretary and Public Relations Officer of IPMAN, Chinedu Ukadike, said the arrangement tackled a persistent problem in the distribution of petroleum products.
“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 said the arrangement would shorten the period during which marketers’ funds remain tied up after product payments. He added that this would improve their cash flow and allow them to use their capital more effectively.
The refinery noted that the reduction in distribution expenses would be particularly important for marketers who supply locations far from the facility. Such transportation usually involves additional costs for haulage, vehicle operations, drivers, insurance, road risks and other logistics.
The removal or reduction of these expenses, it said, could make it easier for marketers to supply distant markets and offer more competitive prices at retail outlets.
The initiative is also expected to reduce some operational risks linked to the transportation of large quantities of petroleum products over long distances by taking the products closer to their destination markets.
The expansion comes as Nigeria’s downstream petroleum sector continues to respond to increased domestic refining capacity and growing competition within the market.
The Dangote refinery has a refining capacity of 700,000 barrels per day. It supplies refined petroleum products to the Nigerian market and has also expanded its activities in international markets.
