Dangote Petroleum Refinery & Petrochemicals has expanded its free petroleum product delivery initiative to Kano, Imo, Anambra and Nasarawa states, a move expected to reduce distribution costs for independent petroleum marketers and create room for lower petrol prices.
The initiative, which initially covered Lagos, Ogun, Rivers, Kaduna, Abuja and Delta, is designed to bring petroleum products closer to marketers and retailers by absorbing the cost of transporting products from the refinery to various parts of the country.
Group Executive Director, Commercial Operations, Oil & Gas, WAEP and Fertiliser, Fatima Aliko Dangote, said the initiative was aimed at ensuring that the benefits of domestic refining translate into savings for businesses and consumers.
She said absorbing delivery costs would remove a significant component of the distribution burden, improve efficiency and create room for savings to flow through the value chain to consumers.
The development has been welcomed by the Independent Petroleum Marketers Association of Nigeria (IPMAN), which said the initiative would ease some of the financial and logistical pressures facing independent marketers and potentially contribute to lower pump prices.
National Publicity Secretary and Public Relations Officer of IPMAN, Chinedu Ukadike, said the initiative addressed longstanding challenges in the distribution chain, particularly the financial burden on marketers who often pay for products and wait for days or weeks before loading and transportation.
He said the new arrangement would reduce the period marketers’ funds remain tied up, improve cash flow and allow businesses to deploy their capital more efficiently.
According to Ukadike, the reduction in transportation costs could also have a direct impact on pump prices, as haulage and other logistics expenses are usually factored into the final cost of petroleum products.
He commended Dangote Refinery for the initiative and urged the company to extend the free delivery programme to more locations, particularly in northern Nigeria.
The initiative is expected to be particularly beneficial to marketers operating far from the refinery, as conventional transportation involves additional costs related to haulage, vehicle operations, driver expenses, insurance, road risks and other logistics.
By taking products closer to destination markets, the refinery is also expected to shorten the supply chain, reduce transportation-related risks and improve the reliability of petroleum product distribution.
Ukadike described the development as a practical demonstration of the benefits of competition and deregulation in Nigeria’s downstream petroleum sector.
The expansion comes as Nigeria’s downstream sector continues to adjust to increased domestic refining capacity and a more competitive market environment.
With a stated capacity of 700,000 barrels per day, the Dangote Petroleum Refinery has increasingly supplied refined petroleum products to the domestic market while expanding its presence in international markets.
The free delivery initiative adds a distribution-cost dimension to the refinery’s growing role in the downstream sector, with the potential for lower logistics expenses to translate into more competitive prices for motorists and households.