Dangote Refinery Forges Landmark Agreement with 12 Marketers for National Fuel Distribution
In a significant development for Nigeria's energy sector, the Dangote Petroleum Refinery has entered into a pivotal offtake agreement with 12 major petroleum marketing companies. This deal is set to facilitate the daily distribution of between 60 million and 65 million litres of Premium Motor Spirit (PMS), commonly known as petrol, across the entire nation. Announced by Aliko Dangote, President of the Dangote Group, in Lagos, this structured framework aims to ensure a consistent and reliable supply of fuel to the domestic market while allowing for the export of any surplus volumes.
Strategic Supply Framework and Export Plans
Under the new arrangement, the refinery will supply up to 65 million litres of petrol daily to meet Nigeria's estimated consumption of 50 million to 60 million litres per day. Any excess output, projected to be between 15 million and 20 million litres daily, will be exported after local demand is satisfied. This approach is expected to generate between 1.8 billion and over 2 billion litres of petrol monthly, depending on production levels and the number of days in each month. By exporting surplus volumes, the initiative seeks to conserve foreign exchange, strengthen Nigeria's trade balance, and reduce the country's long-standing dependence on imported refined petroleum products.
Endorsement and Participating Companies
The agreement has received official endorsement from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), which aims to promote supply stability, discourage hoarding, and support price stability. The 12 petroleum marketing companies involved in this nationwide distribution effort include:
- MRS Oil Nigeria Plc
- Nigerian National Petroleum Company Limited Retail
- 11 Plc
- TotalEnergies Marketing Nigeria
- Rainoil Limited
- Northwest Petroleum & Gas Company Limited
- Ardova Plc
- Bovas & Company Limited
- AA Rano Nigeria Limited
- AYM Shafa Limited
- Conoil Plc
- Masters Energy
Industry Impact and Expert Perspectives
This latest development builds upon an earlier agreement from October 2025 between the refinery and downstream operators, which aimed to improve supply stability and reduce volatility in pump prices. Industry stakeholders have hailed the Dangote Refinery as a strategic national asset capable of reshaping Nigeria's energy security. Bayo Bashir Ojulari, Group Chief Executive Officer of the Nigerian National Petroleum Company Limited, recently described the facility as pivotal, noting that its operational output has reached 661,000 barrels per day, exceeding its design capacity of 650,000 barrels per day.
Analysts emphasize that if effectively implemented, this structured offtake model could significantly enhance supply reliability and mitigate the risk of fuel shortages that have plagued Nigeria in the past. The refinery is expected to play a crucial role in reducing petrol imports, stabilizing prices, and positioning Nigeria as a net exporter of refined products in West and Central Africa. This move aligns with broader reforms in Nigeria's oil and gas sector, including the deregulation of the downstream market and the removal of fuel subsidy under President Bola Tinubu's administration.
Future Prospects and Shareholder Opportunities
Looking ahead, Aliko Dangote has announced plans to make shares in the Dangote Refinery available to Nigerian investors within the next four to five months. Investors will have the option to receive dividends in naira or dollars, as the refinery earns revenue in foreign currency. Dangote has also urged the government to reduce imports and bolster local manufacturing to strengthen the naira, underscoring the refinery's potential to drive economic growth and energy independence for Nigeria.
