By Ologeh Joseph Chibu
The Independent Petroleum Marketers Association of Nigeria (IPMAN) is set for crucial talks with Dangote Petroleum Refinery this week.
The parley is to finalize agreements on the cost and logistics for lifting petrol from the refinery.
Discussions are expected to take place between Tuesday and Wednesday, sources told Irohinoodua following a request by the $20 billion Lekki-based refinery to the Petroleum Retail Outlet Owners Association of Nigeria (PETROAN) to resubmit its proposal for petrol lifting
This move is sparking optimism in the downstream oil sector, with PETROAN expressing hopes that competition among marketers loading petrol from the refinery could lead to lower prices.
The Federal Government had recently authorized petroleum marketers to lift petrol directly from the Dangote refinery without going through the Nigerian National Petroleum Company Limited (NNPC).
This policy shift, according to Finance Minister Wale Edun, is designed to increase competition and market efficiency.
IPMAN’s National Publicity Secretary, Chinedu Ukadike, confirmed the association is keen to establish a strong business relationship with Dangote Refinery.
He mentioned that IPMAN has upgraded its tank farm storage facilities, addressing a critical challenge in fuel distribution. Ukadike expressed readiness for the upcoming talks, stating that IPMAN is well-prepared to compete in the market and contribute to stabilizing fuel prices.
PETROAN President Billy Gillis-Harry also confirmed that his organization had been in communication with Dangote Refinery, with a meeting expected to happen soon.
He emphasized that PETROAN is open to lifting products from multiple sources, including NNPC, traders, and other refineries, ensuring supply diversity.
As the petroleum industry braces for more competition, industry stakeholders are optimistic about potential price reductions. The PETROAN President suggested that petrol prices could drop to around N700 per liter, depending on market dynamics and product availability.
The increase in supply from various sources is expected to encourage marketers to minimize profit margins, fostering a competitive market environment.
Furthermore, IPMAN announced that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has issued a bulk purchase license for independent marketers, enabling them to offtake petrol directly from Dangote Refinery.
This is a significant development in the deregulation process, which aims to create a level playing field for all stakeholders.
However, challenges remain. IPMAN highlighted that debt owed by NNPC to oil dealers, along with high interest rates on loans, continues to affect pricing. Ukadike also noted that independent marketers are seeking government assistance in setting up an energy bank to help finance their operations amid skyrocketing fuel costs since the subsidy removal.
As negotiations progress, IPMAN is working closely with security agencies to prevent fuel theft and ensure that products reach their designated destinations without adulteration, ensuring transparency and stability in the sector.
