Dangote Petroleum Refinery & Petrochemicals has expanded its free petroleum product delivery initiative to Kano, Imo, Anambra and Nasarawa States as part of efforts to reduce distribution costs and create room for lower petrol prices at filling stations.
The expansion takes the initiative beyond Lagos, Ogun, Rivers, Kaduna, Abuja and Delta, where deliveries had already commenced, widening the refinery’s attempt to bring petroleum products closer to marketers and retailers without requiring them to bear long-distance transportation costs.
Under the arrangement, Dangote Refinery absorbs the cost of delivering products to customers, removing a significant expense from the downstream distribution chain.
Transportation costs, particularly for marketers operating far from the refinery, ordinarily include haulage, vehicle operations, driver expenses, insurance and risks associated with moving petroleum products over long distances.
The refinery said removing those costs should improve the economics of fuel distribution and give marketers greater scope to offer more competitive pump prices.
Group Executive Director, Commercial Operations, Oil & Gas, WAEP and Fertiliser, Fatima Aliko Dangote, said the initiative was intended to ensure that the benefits of domestic refining were felt by businesses and consumers beyond the refinery itself.
According to her, the objective is to make petroleum product distribution more efficient while eliminating avoidable costs.
Meanwhile, The Independent Petroleum Marketers Association of Nigeria (IPMAN) welcomed the expansion, saying it could ease some of the financial and logistical pressures confronting independent marketers.
IPMAN National Publicity Secretary and Public Relations Officer, Chinedu Ukadike, said the arrangement could address the problem of marketers committing substantial capital to petroleum product purchases and then waiting for extended periods before products are loaded and transported.