The Dangote Petroleum Refinery has agreed to supply 60 million litres of Premium Motor Spirit (PMS), commonly known as petrol, weekly to the Independent Petroleum Marketers Association of Nigeria (IPMAN), translating to 240 million litres monthly.
Sources within IPMAN revealed that the refinery’s offer of 60 million litres weekly would depend on the level of patronage. This development comes as the Lekki-based refinery aims to raise significant funds to import crude oil and boost production.
Declining Petrol Prices
Oil dealers reported a decline in petrol prices due to increased competition following the deregulation of the downstream oil sector. Over two billion litres of PMS have been imported into the country within 42 days by the Nigerian National Petroleum Company Limited (NNPCL) and other marketers.
IPMAN National Publicity Secretary, Chinedu Ukadike, stated in an interview with The PUNCH that the association’s members could lift any quantity of PMS allocated to them by the Dangote refinery. According to Ukadike, independent marketers distribute most of the fuel imported into Nigeria.
“We are going to off-take the product in millions of litres. Before now, most of the imported products in Nigeria were distributed through IPMAN. So we can off-take the products, no matter the millions of litres that are produced,” Ukadike explained.
He added, “We can take from 10 million litres and above, and Dangote has offered to give us over 60 million litres depending on our patronage. The 60 million litres will be given weekly, and we will distribute it across the country once we start lifting from the refinery.”
Ukadike disclosed that the direct lifting of products would commence before the end of November, after finalising discussions and completing documentation. He noted, “The Dangote Group has assured us that even if we want to start taking products from today, we can start.”
Eliminating Middlemen
IPMAN has created a Special Purpose Vehicle to streamline the distribution process, ensuring efficiency and eliminating the risks associated with intermediaries. “The issue of individuals buying one or two trucks is gone. IPMAN will now act as a major distributor, guaranteeing the safety of our funds,” Ukadike stated.
He highlighted that direct transactions with Dangote were already impacting fuel prices. “Just the announcement of the agreement has caused prices to drop by N10 to N15. By cutting out middlemen, competition is driving prices down, and we expect further reductions before the year ends,” he added.
A major oil marketer also confirmed the price drop, stating, “People may not notice because there’s no big announcement, but deregulation has introduced healthy competition.”
Rising Imports Amid Deregulation
Despite IPMAN’s focus on the Dangote refinery, major marketers and NNPCL continue to import significant volumes of refined products. Within 42 days, NNPCL and other players imported 1.5 million metric tonnes of PMS, equivalent to over two billion litres, alongside substantial quantities of diesel and aviation fuel.
In October alone, over 994,000 metric tonnes of PMS were imported, with Lagos, Warri, Port Harcourt, and Calabar serving as key entry points.
N10bn Equalisation Fund
Meanwhile, IPMAN has called on the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to pay the outstanding N10 billion Petroleum Equalisation Fund owed to marketers.
“The government promised to pay us, but they haven’t. This money was used to reimburse marketers for losses incurred from selling petrol at uniform prices nationwide before deregulation,” explained IPMAN Vice President Hammed Fashola.
Fashola added that while the subsidy regime has ended, marketers need the funds to repay loans and stabilise their businesses. “Banks are pressuring us, and releasing the funds would ease our challenges,” he said.
IPMAN Publicity Secretary Ukadike appealed to NMDPRA, urging prompt payment to support marketers’ operations and ensure seamless nationwide distribution. The NMDPRA has yet to respond to requests for clarification on the issue.
