A new supply framework between the Dangote Petroleum Refinery and a coalition of 20 depot owners is set to reshape the downstream petroleum market, following a high-level meeting in Lagos between Aliko Dangote and key industry leaders.
The session, attended by representatives of Salbas Energy, Optima Energy, Shafa, Rano, and others, laid the groundwork for a pilot supply programme scheduled to run from October 10 to October 31, 2025, covering a total of 600 million litres of petrol (PMS).
Below are the five major takeaways from the agreement that could redefine the market’s short-term pricing and distribution structure:
1. 30 Million Litres Monthly Purchase Commitment
Depot owners collectively agreed to lift 30 million litres of petrol daily from the Dangote Refinery, as part of an initial trial run. Dangote assured participants that the refinery has the production volume to meet this daily target without interruption.
2. Pilot Phase Runs from October 10 to 31
The sales pilot officially began on October 10, with loading expected to continue until October 31, 2025. During this 21-day window, a cumulative 600 million litres of PMS will be sold to the participating depot owners, marking the first structured domestic distribution arrangement since the refinery ramped up operations.
3. Pricing Pegged to September EBOB Benchmark
According to sources present at the meeting, pricing will follow the September European Barrels of Benchmark (EBOB) index, with two differentials:
- EBOB + $45 for coastal sales
- EBOB + $57 for gantry sales
This pricing mechanism links Dangote’s domestic sales to global reference values while offering a margin to account for local logistics and handling costs.
4. 20 Marketers Approved for the Pilot Programme
A total of 20 petroleum firms were approved to participate in the pilot phase, each allocated 30 million litres within the agreed period. The participating companies include:
AA Rano, A.Y.M. Shafa, Salbas Energy, Northwest Petroleum, Rainoil, Ardova, Optima Energy, Masters Energy, Bovas, Dan Marna, NIPCO, Pinnacle Oil and Gas, Heyden Petroleum, Sunbeth, Mainland Oil and Gas, NEPAL Oil and Gas, MRS Oil Nigeria Plc, Conoil Plc, NNPCL Retail, and TotalEnergies Marketing Nigeria Plc.
Dangote officials noted that the list may be expanded as additional marketers meet participation and payment criteria.
5. Exclusive Supply Rights and Controlled Gantry Access
As part of the agreement, gantry loading at the Dangote Refinery will be restricted to the selected depot owners during the pilot window. This measure, insiders say, aims to streamline logistics, ensure accountability, and test market response before a broader rollout.
Industry observers believe this arrangement could temporarily tighten market supply for non-participating depots, potentially driving short-term price adjustments across independent retail outlets.
Outlook
The pilot sale is widely seen as a strategic step by the Dangote Refinery to stabilize local distribution, test commercial viability, and build operational relationships with top-tier marketers.
Market analysts say if the initiative runs smoothly through October, the model could evolve into a monthly structured supply system—offering a clearer price benchmark for domestic transactions and easing volatility in the downstream sector.
