Fuel retailers accuse Dangote refinery of targeting monopoly 

Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has accused Dangote Petroleum Refinery of trying to muzzle competitors and working towards monopoly.

The Independent Petroleum Marketers Association of Nigeria (IPMAN) had earlier said petrol from the refinery was more expensive than imported product.

But Dangote refinery said its ex-depot price of petrol is N990 per litre for trucks and N960 per litre for ships.

It also said any oil marketer selling petrol cheaper than its rate must be importing substandard products.

PETROAN spokesperson, Joseph Obele, in a statement on Monday, said the accusation of importing substandard products by Dangote refinery is “his usual gimmick for maintaining monopoly”.

According to the group, consumers get the best value for pricing when competition is at its peak, hence competition should be encouraged.

“PETROAN has concluded plans with her foreign Refinery counterparts and financial partners to import the best quality of PMS (petrol) and then sell far lesser than the present selling rate of PMS in Nigeria,” the retailers said.

The group said, “We planned to enter the market before December 2024, pending the approval of our import permit licence by the regulatory agency and access to foreign exchange from CBN at the official rate.

“Before now, Dangote Refinery has refused to make public her selling rate of PMS until IPMAN and PETROAN announced readiness to sell lesser.

“The rate of N990 as announced by Dangote refinery was inconsiderate base on the fact Dangote Refinery enjoyed massive concession for accessing foreign exchange during the construction of the refinery.”

Profit margin 

PETROAN said the core determinant for setting the price is the cost of production and margin.

“But this wasn’t the case for the determinant of PMS price by Dangote refinery as they said the parameter was comparison with the international selling rate at the global market.

“A nation that gave you a yet to be disclosed concession for foreign exchange which was highly criticised by financial experts, such a country pricing template shouldn’t have been templated by the selling rate at the international market but rather it should have been cost of production plus fair margin.

“Goods from the China markets are not selling as high like goods from the America market because the cost of production differs.

“The allegations that PETROAN will import inferior products and saying also that an international company is trying to establish a PMS blending plant in Lagos are all strategies for Dangote Refinery to push others out of the market with a view to achieving monopoly for exploitation.

“Few months ago the CEO of Dangote Refinery said NNPC LTD was importing inferior petroleum products, that his own was far better than what NNPC Ltd was selling to marketers.

“In another press conference he said the refinery at Malta was just a blending plant and not a refinery.

“Evidences available showed that diesel (AGO) as a deregulated product was selling less than N800 in Nigeria market few weeks before the commencement of AGO production by Dangote Refinery, at the entrance of AGO market by Dangote refinery we witnessed a rapid surge above N1,000 as against the the perception of a ‘Salvaging Refinery’.”

PETROAN said Dangote refinery made the allegations “with the objectives of closing the doors for other operators so as to enjoy monopoly”.