DANGOTE PETROLEUM REFINERY TO BEGIN DISTRIBUTION OF PMS AND DIESEL NATIONWIDE

Introduction

Dangote Petroleum Refinery is pleased to announce the commencement of a significant national initiative designed to transform Nigeria’s fuel distribution landscape. Effective 15th of August 2025, the Refinery will begin the distribution of Premium Motor Spirit (PMS) and diesel to marketers, petrol dealers, manufacturers, telecoms firms, aviation, and other large users across the country, with free logistics to boost distribution network.

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‎To ensure smooth take-off of this scheme, Dangote Refinery has invested in the procurement of 4,000 brand-new Compressed Natural Gas (CNG)-powered tankers. This phase of the programme will continue over an extended timeframe. The refinery is also investing in Compressed Natural Gas (CNG) stations, commonly referred to as daughter booster stations, supported by a fleet of over 100 CNG tankers across the country to ensure seamless product distribution.

‎This strategic programme is part of our broader commitment to eliminating logistics costs, enhancing energy efficiency, promoting sustainability and supporting Nigeria’s economic development. It affirms our dedication to improving the availability and affordability of fuel, in support of broader efforts to strengthen the economy and improve the well-being of all Nigerians.

‎Under this initiative, all petrol stations purchasing PMS and diesel from the Dangote Petroleum Refinery will benefit from this enhanced logistics support. Key sectors such as manufacturing, telecommunications, and others will also gain from this transformative initiative, as reduced fuel costs will contribute to lower production costs, reduced inflation, and foster economic growth. Players in these key sectors and others can purchase directly from the Dangote Petroleum Refinery.

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‎In addition, the refinery will offer a credit facility to those purchasing a minimum of 500,000 litres—allowing them to obtain an additional 500,000 litres on credit for two weeks, under bank guarantee.

‎This pioneering effort marks a major milestone in our vision to revolutionise Nigeria’s energy sector. Dangote Refinery is dedicated to ensuring that no place is left behind. Our goal is to provide equitable access to affordable fuel for all Nigerians, regardless of location, making energy more accessible and sustainable for everyone, wherever they may be.

‎It is expected to revitalise previously inactive petrol stations, thereby driving job creation, stimulating small and medium-sized enterprises (SMEs), increasing government revenue, improving fuel access in rural and underserved communities, and strengthening investor confidence in Nigeria’s downstream petroleum sector.

‎This initiative is inline with the Renewed Hope Agenda of His Excellency, President Bola Ahmed Tinubu, reflecting our shared commitment to economic progress, stability, and inclusive development. We sincerely thank the Federal Government for its continued support, especially through the Naira-for-Crude scheme, which has helped stabilise fuel supply amid global price volatility. It marks a major revolution in the midstream and downstream sectors and stands as a key example of President Bola Tinubu’s bold and reformative economic policies.

The Dangote Refinery fuel supply deal marks a major milestone in Nigeria’s petroleum industry, potentially reshaping the country’s fuel market dynamics. As Africa’s largest oil refinery, the Dangote Petroleum Refinery is set to reduce Nigeria’s heavy dependence on imported fuel, stabilize prices, and boost local refining capacity.

This deal, involving partnerships with the Nigerian National Petroleum Company Limited (NNPC) and other oil marketers, aims to ensure a steady supply of Premium Motor Spirit (PMS), diesel, and aviation fuel within Nigeria and across West Africa.

Background of the Dangote Refinery

The Dangote Refinery, located in the Lekki Free Trade Zone, Lagos, is a $19 billion mega project with the capacity to process 650,000 barrels of crude oil per day. Its establishment addresses Nigeria’s long-standing challenge of importing refined petroleum products despite being Africa’s top crude oil producer.

Prior to the refinery’s commissioning, Nigeria spent billions of dollars annually importing fuel, often facing shortages due to foreign exchange scarcity, logistic delays, and global oil market volatility.

Details of the Fuel Supply Deal

The fuel supply deal is a strategic agreement between Dangote Refinery and key stakeholders, including:

• NNPC Limited – For crude oil supply and off-take arrangements.
• Independent Petroleum Marketers Association of Nigeria (IPMAN) – For nationwide fuel distribution.
• Major Oil Marketers Association of Nigeria (MOMAN) – For retail and wholesale fuel sales.

The agreement ensures that the refinery’s products will be prioritized for local consumption before export, aiming to end fuel scarcity in Nigeria.

Economic Benefits of the Deal

1. Reduced Fuel Importation – Nigeria will save billions in foreign exchange by refining crude oil locally instead of importing fuel.
2. Job Creation – The refinery and its supply chain will create thousands of direct and indirect jobs.
3. Price Stabilization – With reduced import dependency, fuel prices may become more stable, shielding Nigeria from global oil market shocks.
4. Boost to the Naira – Lower demand for foreign currency could strengthen the Nigerian Naira.
5. Regional Fuel Hub – Nigeria could become a major fuel supplier to neighboring African countries.

Challenges Facing the Deal

While the deal is promising, several challenges remain:

• Crude Oil Supply Security – Ensuring a steady supply of crude oil to the refinery without disruptions.
• Pipeline Vandalism – Oil theft and pipeline attacks could affect production and distribution.
• Government Policies – Changes in subsidy policies, taxes, or import restrictions could influence operations.
• Market Competition – Other refineries and importers might adjust strategies, impacting the market share.
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Impact on Fuel Prices

One of the most anticipated effects of the Dangote fuel supply deal is the stabilization of fuel prices. By cutting out middlemen in international imports, the refinery can offer more competitive rates. However, final pump prices will still depend on factors such as:

• Government fuel subsidy policies
• Exchange rate fluctuations
• Distribution costs within Nigeria

International Implications

The Dangote Refinery is not just a Nigerian project — it has regional and global implications. West African countries that rely on fuel imports could benefit from shorter supply chains, reduced shipping costs, and improved fuel quality. Additionally, by exporting to Europe and other markets, Dangote could enhance Nigeria’s trade balance.

Stakeholders’ Reactions

Reactions to the deal have been mixed:

“This is the beginning of a new era in Nigeria’s oil industry. The Dangote Refinery will transform our energy security,” said an NNPC spokesperson.

“We are hopeful, but we need to see if the pump prices truly come down,” remarked a fuel station owner in Abuja.

Future Outlook

With the fuel supply deal in motion, industry analysts predict that within the next 12–18 months, Nigeria could achieve near self-sufficiency in refined petroleum products. If maintained, this could lead to improved infrastructure, economic diversification, and a stronger energy sector.

However, sustained success will depend on consistent crude oil supply, transparent pricing policies, and ongoing investment in distribution infrastructure.

Conclusion

The Dangote Refinery fuel supply deal is a landmark development for Nigeria’s oil and gas industry. If implemented effectively, it could end decades of fuel import dependence, stabilize prices, create jobs, and position Nigeria as a fuel export leader in Africa. For millions of Nigerians, this could mean more affordable fuel and fewer queues at petrol stations — a long-awaited change.