Fuel Transporters Protest Dangote’s Free Direct Fuel Delivery, Threaten Legal Action

Major fuel consumers and filling stations across Nigeria are increasingly bypassing traditional intermediary suppliers in favor of Dangote Petroleum Refinery’s free direct fuel delivery service, triggering concerns among transport operators over the future of their business.

Yusuf Othman, President of the National Association of Road Transport Owners (NARTO), criticized the emerging practice, highlighting that many buyers are disregarding pre-existing agreements with transporters in favor of Dangote’s free logistics offering. According to Othman, NARTO members have formal and informal agreements with various companies to supply fuel using their fleet of about 30,000 trucks. These contracts, some of which were leveraged to secure bank loans for purchasing trucks, are now under threat as bulk consumers opt to receive fuel directly from Dangote without paying for delivery.

Othman said, “If I sign an agreement with you for service by virtue of my trucks, and somebody else is coming to supply directly and for free, it creates a very delicate situation.” He revealed that his members were not officially informed about the Dangote arrangement but confirmed that trucks owned by NARTO members are increasingly being sidelined.

He appealed to the Federal Government and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to intervene, referencing Section 212 of the Petroleum Industry Act (PIA), which he suggests deems Dangote’s free delivery practice illegal.

Dangote Petroleum Refinery launched the free fuel distribution scheme earlier this year, deploying 4,000 new Compressed Natural Gas (CNG)-powered tankers to deliver petrol and diesel directly to marketers, filling stations, telecom companies, and other large fuel consumers nationwide. The initiative aims to eliminate logistics costs, lower fuel pump prices, improve nationwide fuel access, especially in underserved areas, and create thousands of jobs.

While the scheme has been praised for lowering transport and distribution costs—fuel logistics cost typically accounts for 10-30% of fuel price in Nigeria—its disruption of existing distribution networks has sparked unease among independent marketers, transporters, and tanker drivers who risk losing business and livelihoods.

ADVERTISEMENT

Experts suggest the initiative will stabilize fuel prices around ₦870-₦920 per litre nationwide and reduce inflationary pressures, but critics warn it may centralize control over fuel distribution, lead to job losses for independent truck operators, and threaten long-term supply chain diversity.

The dispute underscores a tense transition in Nigeria’s downstream petroleum sector as Dangote’s refinery reshapes the market with its direct-supply model, challenging traditional freight and marketing arrangements.