Billionaire businessman and Chairman of Geregu Power Plc, Femi Otedola, has told members of the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) to rethink their operations, insisting that their business model is outdated in the face of sweeping changes being driven by the Dangote Refinery.
Otedola, speaking at an industry dialogue in Lagos on Sunday, said the emergence of the 650,000-barrel-per-day Dangote Refinery has effectively disrupted the traditional petroleum products supply chain, making it imperative for downstream players to innovate or risk being pushed aside.
“For decades, your business model thrived on importation and distribution of refined products. But today, the game has changed. With local refining capacity coming onstream, and with Dangote already reshaping petroleum trade flows, those who fail to adapt will become irrelevant”.
He urged petroleum marketers to embrace partnerships, invest in infrastructure, and explore value-added services to remain competitive in a sector where importation margins are fast disappearing.
According to Otedola, the refinery will not only guarantee Nigeria’s energy security but also create new opportunities for logistics, storage, and exports. “The focus now should be on efficiency, innovation, and integration into a value chain that is no longer dependent on foreign refineries,” he stressed.
Industry observers say Otedola’s remarks reflect broader concerns within the downstream sector, where many depots and independent marketers fear being sidelined by the refinery’s dominance.
However, some DAPPMAN members argue that their depots will remain relevant, especially in distribution and retail, noting that Nigeria’s large population and regional exports will require extensive infrastructure beyond the refinery’s immediate scope.
The Dangote Refinery, which has already begun exporting diesel and aviation fuel to West Africa, is expected to start supplying Premium Motor Spirit (PMS) to the domestic market before the end of the year. Analysts say its impact on pricing, supply chains, and forex demand will fundamentally alter Nigeria’s petroleum landscape.
