Dangote Petroleum Refinery has partnered with two more companies to enhance the distribution of Premium Motor Spirit (petrol) across the country and ensure long-term business security amid rising competition.
The new partnership with Heyden Petroleum and Ardova Plc aims to supply affordable petrol to various states in Nigeria.
“This strategic move is designed to ensure a steady supply of petroleum products at affordable prices, further stabilizing the nation’s fuel market and enhancing energy security for consumers,” Dangote Refinery stated.
The strategy is a win-win for Dangote Refinery as the deal will ensure long-term petrol sales and help mitigate competition from NNPCL and other refineries now emerging in Nigeria.
The company noted that the partnership was made possible by the crude-for-naira swap initiative of President Bola Tinubu, which prioritises crude oil availability for local refineries in exchange for naira.
The bulk purchase agreements entered into by the companies with Dangote Refinery ensure better pricing deals similar to the agreement with MRS, the first company to enter such a deal with the refinery.
In December, MRS Oil announced a price reduction to N935 per litre across all its operating stations, countering the price disparities that have marred the supply of petrol in the country.
The agreement also bolstered MRS’s share price to a 52-week high last Friday as investors believe the new deal will ensure business and profit sustainability.
Similarly, Heyden and Ardova are now assured of a consistent supply of petroleum products from the world’s largest single-train refinery.
Commenting on the new agreement, Ardova stated, “this framework will see Ardova Plc offtake a full slate of petroleum products from the refinery. While Ardova Plc has been a significant off-taker from the refinery since its inception, this new framework will institutionalize a more robust relationship between the two companies to further enhance the emerging competitive landscape in the downstream oil and gas industry in the country.”
The company believes the partnership will significantly impact the business model of Nigeria’s oil and gas market and help stabilize prices.
“The partnership with the Dangote Refinery is poised to have a transformative impact on Nigeria’s oil and gas market. By ensuring a stable and affordable supply of fuel products across the over 1,000 retail outlets of the two companies, the agreement will help alleviate the recurring issue of fuel scarcity that has long plagued Nigeria.”
