How Our Refinery Ended Nigeria’s 50-Year Fuel Queues — Aliko Dangote
Nigeria’s half-century struggle with petrol scarcity is “over,” Aliko Dangote declared at a Lagos briefing marking one year of petrol production at the 650,000 bpd Dangote Petroleum Refinery. In his words, Nigerians are “witnessing a new era”—one anchored on domestic supply, logistics reform, and a clear industrial policy tilt away from import dependence.
What Dangote Actually Said — The Full Picture
1) A 50-Year Problem, A Year-Old Solution
- Fuel queues since 1975: Dangote framed the refinery’s first year as the turning point that finally broke decades of recurrent scarcity.
- Price relief has begun: Average pump prices that hovered near ₦1,100/litre before production have eased to ~₦841/litre across the South-West, Abuja, Delta, Rivers, Edo and Kwara—ahead of full nationwide logistics equalisation.
2) “We Took the Risk—And Could Have Lost Everything”
- Building a sovereign-scale refinery as a private venture attracted intense skepticism from investors, industry experts and foreign officials who insisted only governments attempt projects this large.
- Dangote said bluntly: if the project had failed, lenders could have seized his assets—but the bet on Nigeria and Africa had to be made.
3) Capacity Today—and the Scale-Up Plan
- Current nameplate: 650,000 bpd.
- Year-2 target: 700,000 bpd, positioning Nigeria as Africa’s refining hub, the world’s leading polypropylene exporter, and a major fertiliser supplier via integrated petrochemicals.
4) Exports and FX—Proof of Surplus
- From June to early September 2025, the refinery exported over 1.1 billion litres of PMS, demonstrating capacity beyond domestic needs and the ability to earn FX while meeting local demand.
5) Logistics Reset: CNG Trucking, Not Retail
- To squeeze out inland transport costs, 4,000 CNG-powered trucks are being deployed nationwide—creating ~24,000 jobs across drivers, mechanics and fleet managers.
- No foray into retail: Despite offers to acquire filling stations, Dangote said the refinery will stay focused on wholesale supply and partnerships to avoid channel conflicts.
- He praised independent marketers (IPMAN) for embracing a free distribution initiative using CNG fleets.
6) Jobs, Pay and Welfare—Dangote’s Workforce Pledge
- No job displacement; net job creation is the goal.
- Staff packages include salaries up to 3× minimum wage, life insurance, comprehensive health insurance (employee, spouse and up to four children) and a lifetime pension.
7) Industrialisation Over Importation—A Policy Challenge
- Dangote urged lawmakers to back the “Nigeria-First” policy with enforceable laws, warning that dumping of cheap imports undermines local manufacturing.
- Quote-level message: “Imports export jobs and import poverty. We must build our own economy.”
8) Security and Rule of Law
- On infrastructure protection and operations, he stressed Nigeria is governed by the rule of law and that security agencies are fully empowered to safeguard assets and lives.
Why This Matters to Prices, FX and Growth
- Structural shift in price formation: With domestic refining displacing imports, the market sheds freight, insurance and trader premia; ex-refinery economics become the anchor.
- Logistics deflation ahead: As CNG trucking scales (and pipelines/depots are rehabilitated), inland delivery costs should fall further—key to narrowing regional price gaps.
- Exportable surplus and petrochemicals: Surplus PMS, polypropylene and fertiliser underpin FX inflows, non-oil exports, and manufacturing spillovers (plastics, packaging, agro-inputs).
The Execution Risks (and How to Mitigate)
- Pipelines & Depots: Fast-track product pipeline rehabilitation and upgrade depots to move more by pipe/coastal shipping and less by road.
- Open Access & Transparency: Publish clear ex-refinery and offtake terms for all marketers; adopt a weekly pricing dashboard (ex-refinery, freight, depot benchmarks) to deepen competition.
- Stable Rules: Keep tax/levy and downstream policy predictable to avoid re-inflating risk premia that feed into pump prices.
- Secure Corridors: Treat product-route security as an economic priority to protect the last mile and keep logistics costs trending down.
BRANDECONOMY Verdict
A year in, Dangote Refinery has done what decades of import management could not: stabilise domestic fuel supply, bend the cost curve and create a path to FX-earning surplus—with a pragmatic logistics play (CNG fleets) to carry benefits inland. Lock in gains with pipeline access, transparent pricing, and steady regulation, and Nigeria finally gets the downstream backbone that compounds into jobs, non-oil exports and real consumer relief.
Bottom line: This is more than a refinery anniversary. It is the early proof that industrialisation beats importation—and that a private mega-asset, scaled and integrated, can end queues, lower costs and lift the wider economy.
