CoolNews Exclusive Investigation

 September 24, 2025

In what could be described as a pivotal moment for Nigeria’s petroleum sector, the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) has issued a comprehensive appeal to the Dangote Refinery, demanding more equitable access to petroleum products and transparent pricing mechanisms to address the persistent fuel scarcity plaguing the nation.

The association’s latest intervention comes amid growing tensions in the downstream petroleum sector, where questions of market control, pricing transparency, and distribution efficiency continue to dominate industry discourse.

The Core of the Dispute

Speaking exclusively on Channels Television’s flagship program “The Morning Brief” Wednesday morning, DAPPMAN spokesperson Ikem Ohia laid out the association’s position with unprecedented clarity, emphasizing that their concerns extend far beyond simple commercial interests.

“Our fundamental and unwavering objective is ensuring petroleum products are consistently available to Nigerian consumers at reasonable, market-driven prices, effectively eliminating the chronic stock-outs that force millions of Nigerians to endure lengthy fuel queues,” Ohia stated emphatically during the television appearance.

The DAPPMAN representative was careful to dispel any notion of antagonism toward the Dangote Refinery, characterizing the relationship as one requiring collaborative enhancement rather than confrontational restructuring.

“We categorically dismiss any claims suggesting a rift with the refinery. Our members seek nothing more than transparent arrangements that guarantee regular, reliable distribution channels for the benefit of all Nigerians,” he clarified.

Fundamental Market Access Challenges

The association has identified two critical bottlenecks that continue to hamper effective collaboration with Africa’s largest refinery:

Pricing Structure Opacity

The lack of transparent pricing mechanisms remains a significant concern for DAPPMAN members, who argue that unclear pricing structures make it impossible to plan effective distribution strategies or ensure competitive retail pricing.

“The central question that continues to dominate our discussions is straightforward yet complex: at what specific price points are petroleum products offered to us as legitimate marketers, and do we genuinely possess unfettered access to purchase these products in quantities sufficient to meet national demand?” Ohia questioned.

Limited Bulk Purchase Opportunities

Despite representing a substantial portion of Nigeria’s distribution infrastructure, DAPPMAN members report restricted access to bulk purchasing arrangements, forcing them to rely on smaller-scale transactions that prove inadequate for national supply requirements.

Leveraging Nigeria’s Existing Distribution Infrastructure

DAPPMAN has consistently emphasized the strategic importance of utilizing Nigeria’s existing petroleum distribution infrastructure, developed through decades of investment and operational refinement.

Extensive Network Coverage

The association’s members have established a comprehensive distribution network spanning over two decades, featuring strategically positioned depot facilities in Nigeria’s key petroleum hubs: Lagos, Warri, Port Harcourt, and Calabar. These facilities represent billions of naira in infrastructure investment and possess the technical capacity to handle massive product volumes.

“We are specifically requesting that Dangote Refinery recognize and utilize these existing, fully operational depots that have been serving Nigerian consumers effectively for years. This approach would immediately expand distribution capacity and ensure we can meet the diverse demands of Nigerian consumers across all geographical regions,” Ohia explained.

Proven Distribution Capabilities

Many DAPPMAN members operate extensive retail networks that extend deep into Nigeria’s rural and urban markets. Some individual members manage up to 300 filling stations, representing a distribution reach that few single entities can match.

“The mathematics are indisputable; current supply arrangements simply cannot meet full market requirements. Bulk depot deliveries represent the only viable solution for serving Nigerians effectively and efficiently,” Ohia emphasized.

Business Negotiations: Setting the Record Straight

Addressing persistent misconceptions about DAPPMAN’s negotiating position, Ohia provided detailed clarification on the association’s approach to discussions with the Dangote Refinery.

No Subsidy Requests

“We want to be absolutely clear on this point: we are businesspeople engaged in legitimate commercial activities; Dangote is similarly a businessman operating in the same market environment. We are categorically not requesting subsidies of any kind from any source. We entered into good-faith negotiations and continue engaging in these discussions specifically to identify mutually beneficial arrangements that can bridge existing operational gaps,” he stated firmly.

International Industry Standards

The DAPPMAN spokesperson referenced global petroleum industry practices to support the association’s position, noting that successful refineries worldwide typically emphasize bulk supply arrangements with established off-takers.

“International best practices clearly demonstrate that refineries achieve optimal efficiency through bulk evacuation systems managed by qualified off-takers capable of lifting massive product quantities. This approach ensures continuous production cycles and prevents the bottlenecks associated with exclusive reliance on retail gantry sales, which simply cannot accommodate national demand levels,” Ohia explained.

Historical Context and Previous Negotiations

The current situation represents the culmination of years of attempted collaboration between DAPPMAN and the Dangote Refinery, with mixed results despite good-faith efforts from both parties.

Pre-Production Engagement

DAPPMAN proactively approached Dangote representatives before the refinery commenced commercial production, specifically requesting establishment of bulk supply arrangements that would benefit both parties while serving national interests.

“We demonstrated foresight and good faith by approaching Dangote well before production began, specifically requesting bulk supply partnerships. Unfortunately, despite extensive discussions, no firm understanding was reached that addressed our members’ capacity to serve national demand,” Ohia revealed.

Current Partnership Structure

The refinery has elected to work with a limited number of selected partners, including only one or two DAPPMAN members, creating what the association views as an unnecessarily restrictive distribution model.

“Rather than embracing an open, competitive system that would benefit all stakeholders and ultimately Nigerian consumers, the current approach favors a controlled system working with a few selected partners. We firmly believe that an open, transparent system rather than a controlled, restrictive one will better serve our country’s interests,” he stated.

Distribution Capacity and Market Reality

The ongoing debate highlights fundamental questions about Nigeria’s petroleum distribution capacity and the most effective approaches to meeting national demand.

Current Supply Inadequacy

Industry figures consistently demonstrate that current supply arrangements fail to meet comprehensive market requirements, resulting in the persistent fuel queues that have become synonymous with Nigeria’s petroleum sector challenges.

“Market data doesn’t lie, and the evidence is clear to anyone willing to examine it objectively: whatever quantities are currently being supplied through existing arrangements do not meet full market needs. This shortfall directly translates to the fuel queues and supply disruptions that Nigerian consumers experience daily,” Ohia stated.

Infrastructure Investment Requirements

The debate also touches on significant infrastructure investments required to support nationwide distribution, with different stakeholders advocating various approaches to financing and managing these requirements.

Industry Stakeholder Responses

The DAPPMAN position has generated varied responses from different industry stakeholders, reflecting the complex nature of Nigeria’s petroleum sector dynamics.

Dangote Refinery’s CNG Initiative

Dangote’s recent announcement of a 4,000 compressed natural gas (CNG) truck investment for nationwide distribution has been characterized by some industry observers as a response to distribution challenges, while others view it as an attempt to maintain control over the entire value chain.

This initiative has raised additional concerns among marketers about potential market concentration and the implications for competitive distribution systems.

Otedola’s Advisory Position

Prominent businessman Femi Otedola recently weighed into the discussion, advising DAPPMAN to adapt to evolving market dynamics rather than opposing the Dangote operational model.

Otedola specifically suggested that the association consider restructuring their approach and potentially exploring acquisition of the Port Harcourt Refinery as an alternative to current negotiations with Dangote.

Retail Outlet Owners’ Perspective

Billy Gilly-Harris, President of the Petroleum Products Retail Outlets Owners Association of Nigeria, has expressed skepticism about the adequacy of current distribution solutions.

“The 4,000 trucks represent a significant investment, but our analysis suggests this capacity remains insufficient to ensure steady, reliable supply across Nigeria’s vast geographical expanse and diverse market requirements,” Gilly-Harris stated.

Dangote Refinery’s Official Position

The refinery has maintained a firm stance on several key issues central to the ongoing discussions with DAPPMAN.

Logistics Cost Allocation

Dangote Petroleum Refinery has consistently stated that it will not absorb transportation expenses that marketers seek to transfer to the refinery, arguing that such costs represent standard industry practices that each market participant must manage independently.

Subsidy Claims Rebuttal

In recent official statements, the refinery has dismissed DAPPMAN’s claims regarding subsidies exceeding ₦1.5 trillion as “false and unfounded,” maintaining that all product sales occur at gantry facilities strictly based on production costs and regulated margins established by relevant regulatory authorities.

Regulatory Compliance

The refinery emphasizes its adherence to federal government policies, particularly noting that petroleum product subsidies were officially abolished in May 2023, making any subsidy-related discussions irrelevant to current market operations.

Broader Economic Implications

The resolution of this dispute carries significant implications for Nigeria’s broader economic landscape, extending far beyond the petroleum sector itself.

Consumer Impact

Nigerian consumers continue to bear the burden of supply disruptions, with fuel queues and price volatility affecting transportation costs, food prices, and overall economic activity across the country.

Investment Climate

The outcome of these negotiations will likely influence future investment decisions in Nigeria’s petroleum sector, particularly regarding downstream operations and distribution infrastructure development.

Regulatory Framework

The dispute highlights potential gaps in Nigeria’s petroleum sector regulatory framework, particularly regarding market access, pricing transparency, and competitive practices in the downstream sector.

Path Forward: Potential Solutions

Industry analysts have identified several potential approaches to resolving the current impasse between DAPPMAN and Dangote Refinery.

Collaborative Framework Development

Establishment of a formal collaborative framework that addresses both parties’ concerns while prioritizing national supply security could provide a foundation for sustainable partnership.

Regulatory Intervention

Enhanced regulatory oversight and intervention might be necessary to ensure competitive market practices and prevent potential monopolistic tendencies in the downstream sector.

Infrastructure Optimization

Optimal utilization of existing distribution infrastructure, combined with strategic new investments, could significantly improve national supply capacity while reducing operational costs for all stakeholders.

Looking Ahead: Industry Transformation

The ongoing dialogue between DAPPMAN and Dangote Refinery represents more than a commercial dispute; it reflects fundamental questions about the future structure and operation of Nigeria’s petroleum sector.

As the country transitions from petroleum product imports to domestic refining capacity, establishing sustainable, competitive distribution systems becomes crucial for long-term energy security and economic stability.

The resolution of access and pricing concerns could dramatically reshape Nigeria’s downstream petroleum sector, potentially improving product accessibility, stabilizing pricing, and eliminating the chronic supply disruptions that have characterized the sector for decades.

Conclusion

The current negotiations between DAPPMAN and Dangote Refinery occur at a critical juncture in Nigeria’s petroleum sector evolution. The outcome will likely influence not only immediate fuel availability and pricing but also the long-term structure of Nigeria’s energy sector.

As both parties continue discussions, industry observers, regulatory authorities, and ultimately Nigerian consumers await concrete agreements that can deliver the reliable, competitively priced petroleum products the nation desperately needs.

The stakes extend beyond commercial interests to encompass national energy security, economic stability, and the daily lives of millions of Nigerians who depend on affordable, accessible petroleum products for their livelihoods and economic activities.

This is a developing story. CoolNews will continue monitoring negotiations between DAPPMAN and Dangote Refinery, providing comprehensive coverage of developments that impact Nigeria’s petroleum sector and consumer interests.

For more energy sector coverage and analysis, follow CoolNews Energy Desk

Contact the reporter:  coolnews@gmail.com