The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has finalised a strategic agreement with the Dangote Petroleum Refinery, enabling direct lifting of petroleum products for nationwide distribution. This milestone comes as the newly refurbished Port Harcourt Refinery begins exporting refined products, sparking debates among industry stakeholders over its capacity and impact.
In a statement on Saturday, PETROAN announced the deal, which was sealed on December 2, 2024, following negotiations led by its president, Dr. Billy Gillis-Harry. The agreement reserves a monthly volume for PETROAN members, ensures favourable pricing, and establishes streamlined payment modalities.
Dr. Joseph Obele, PETROAN’s National Public Relations Officer, expressed optimism about the partnership, highlighting its significance in averting fuel scarcity during the festive season. “The general public will be the greatest beneficiary, as this guarantees product availability and affordability,” Obele said.
The collaboration follows a similar arrangement struck by the Independent Petroleum Marketers Association of Nigeria (IPMAN) with the $20 billion Lekki-based Dangote Refinery, the largest in Africa and Europe. By cutting out middlemen, the refinery aims to lower costs and provide consistent fuel supply across 30,000 IPMAN members and 150,000 retail outlets nationwide.
Meanwhile, the Port Harcourt Refining Company (PHRC), which resumed operations on November 26 after multiple delays, has exported its first shipment of low-sulphur straight-run fuel oil to Dubai. The initial 15,000-metric-tonne cargo marks a phased return to operations, with current output estimated at 20,000 barrels per day.
Kpler, a data analytics firm, noted that while the PHRC’s contribution to global fuel benchmarks remains modest, its revival alters market dynamics in the Atlantic Basin. “This development will displace imports from traditional suppliers in Africa and Europe, as Nigerian fuel imports decline,” Kpler reported.
The PHRC’s second processing unit is expected to commence operations by late 2025, with the facility targeting a full capacity of 210,000 barrels per day by 2026. However, experts warn that scaling up production will take time, given the refinery’s reliance on simple configurations and ongoing test runs.
Industry operators remain divided over the implications of PHRC’s output and export strategy, with concerns raised about prioritising exports over domestic needs. Nonetheless, the twin developments of the Dangote partnership and PHRC’s revival signal a transformative shift in Nigeria’s downstream oil sector.
As the festive season approaches, PETROAN has called on stakeholders to avoid panic buying and support efforts to stabilise the supply chain. “We urge all players in the downstream sector to collaborate in sustaining fuel availability and affordability,” the association stated.
The next months will reveal whether these measures can deliver on their promises of stability and efficiency, shaping a new chapter in Nigeria’s quest for energy security.
