Dangote’s initiative, stimulant to economy – Experts
Dangote refinery
Dangote’s initiative, stimulant to economy – Experts
Dangote Petroleum Refinery’s new initiative has continued to draw accolades from energy experts in the country, with some describing it as the best that has happened to the sector since Independence, as it will stimulate economic growth.
The Chief Executive of Financial Derivatives Company, Bismarck Rewane, said the company’s free distribution initiative would reduce production costs, ease inflationary pressures, and stimulate economic growth.
Dismissing concerns about the refinery becoming a monopoly, he argued that inefficiencies in the sector had been systemic and long-standing, adding that the scheme would help curb the parasitic role traditionally played by middlemen.
“What Dangote is doing achieves two key objectives: delivering products across the entire country at a uniform price by eliminating bridging costs and significantly reducing logistics expenses through the use of Compressed Natural Gas (CNG)-powered trucks to reach every corner of the nation.
“In economic terms, middlemen (who typically do not invest) are often viewed as parasitic, extracting margins simply for distributing goods. Dangote is bypassing this layer by directly handling distribution and, notably, providing credit facilities to the retail end of the business,” he said.
Co-founder of Dairy Hills, Kelvin Emmanuel, said Dangote’s decision to absorb logistics costs marks a turning point that could finally allow Nigerians to enjoy the benefits of local refining.
On his part, Ibukun Phillips described the move as “revolutionary”, suggesting it could reshape Nigeria’s energy sector by improving affordability and access, particularly in rural communities.
“Rural consumers, who typically pay more despite earning less, stand to benefit immensely. This could also revive abandoned filling stations and promote equitable distribution,” she explained.
The Independent Petroleum Marketers Association of Nigeria (IPMAN) commended the development, calling it a timely resolution to longstanding challenges in the downstream sector.
IPMAN’s National Publicity Secretary, Chinedu Ukadike, stated that the new model would significantly reduce logistical burdens for independent marketers by delivering more affordable fuel directly to filling stations .
“Our pipelines have been non-functional for years, yet nothing has been done to revive the infrastructure linking the country’s 21 depots. We’ve had to rely on expensive transport from coastal depots,” Ukadike said. “Dangote’s intervention lifts a huge burden off the shoulders of independent marketers.”
Dangote Refinery recently invested over N720 billion to implement its landmark initiative of deploying 4,000 CNG-powered trucks for the nationwide distribution of petroleum products, which is expected to save Nigerians over N1.7 trillion yearly.
