Dangote Refinery to Subsidise Petrol Transport Costs to Equalise Prices Nationwide

Dangote Petroleum Refinery and Petrochemicals FZE will take on part of the cost of moving petrol from its Lekki plant to far-flung markets across Nigeria, in a push to narrow the price gaps that have kept fuel more expensive in parts of the north.

The company is also deploying more trucks to expand distribution and reduce the regional differences that transportation expenses create. Edwin Devakumar, Vice President of Dangote Petroleum Refinery, disclosed the plan during a media engagement with senior editors at the refinery complex on Friday.

Uniform Price Target for Sokoto, Kano, Calabar

Devakumar said the goal is a situation where a litre of Dangote petrol costs broadly the same whether it is bought in Sokoto, Kano or Calabar.

"We are now actually trying to equalise the price, whether you want to buy in Sokoto, whether you want to buy in Kano or buy in Calabar. The price should be the same," he said.

"That is why we brought all these trucks, so we can even subsidise the transport and ensure that there is a uniform price and distribution throughout the country."

With the refinery sitting in Lekki, Lagos, hauling petrol to distant northern markets adds significant logistics costs to the final pump price. That gap is what the refinery now wants to absorb, at least in part.

More Trucks, Wider Reach

According to Devakumar, the impact of the initiative is already becoming noticeable, and the refinery will keep working to extend its reach to more parts of the country.

He explained that tackling transportation expenses sits at the centre of the company's strategy to make its products more accessible nationwide.

"One thing is, we are even trying to make it further impact by taking the products all over the country and solving the transportation cost," he said.

The executive also maintained that petrol prices in Nigeria remain relatively low compared with those in some neighbouring countries. He pointed to price differences between Nigeria and other countries along the West African coast, particularly amid the current challenges affecting fuel markets in the region.

What This Means for Motorists and Businesses

Transportation has long been one of the biggest reasons petrol sells for different prices in different states, even when the product comes from the same source. A refinery willing to carry part of that cost could narrow the spread between Lagos and far northern cities.

For Nigerian businesses, a more uniform pump price lowers the planning risk that comes with moving goods across regions. For motorists in Sokoto, Kano and Calabar, the promise is straightforward: the price at the pump should depend less on where they live.

Whether the subsidy holds will depend on how quickly the additional trucks move product and how the refinery's distribution network grows across the country.