Dangote Petroleum Refinery says it has committed over N720 billion toward the deployment of 4,000 Compressed Natural Gas (CNG)-powered trucks intended for the nationwide distribution of petroleum products.
The project, according to company estimate, may result in cost savings exceeding N1.7 trillion annually for Nigerians.
The company noted that the initiative will take on fuel distribution costs estimated at more than N1.07 trillion each year. It is also expected to impact over 42 million Micro, Small and Medium Enterprises (MSMEs) by potentially lowering energy-related expenses.
The company further explained that the distribution model is designed to eliminate transportation costs for fuel marketers and bulk consumers, which could contribute to a decrease in pump prices and help curb inflation. Beginning August 15, the company is scheduled to begin delivering petrol and diesel directly to filling stations, industrial sites, and other high-demand users.
A statement obtained from the refinery noted plans to meet the country’s daily demand of approximately 65 million litres of refined petroleum products—comprising 45 million litres of Premium Motor Spirit (PMS), 15 million litres of diesel, and 5 million litres of aviation fuel.
With logistics costs projected at about N45 per litre, the initiative is expected to absorb an annual distribution expenditure exceeding N1.07 trillion.
The investment includes the purchase of 4,000 CNG-powered trucks and the development of a network of CNG stations across the country.
The company stated that the initiative aims to address distribution inefficiencies, reduce carbon emissions, and contribute to broader economic activity. It also said that lower fuel distribution expenses could lessen inflationary pressures and reduce production costs.
The programme is projected to reactivate inactive filling stations and generate employment opportunities—an estimated 15,000 direct jobs across the logistics sector, including truck drivers, CNG station staff, and others.
According to the refinery, the effort could also deter cross-border smuggling of petroleum products and enable a more structured and environmentally conscious fuel distribution network.
The Presidency has acknowledged the plan as a significant step in the government’s wider strategy to advance gas-powered mobility in Nigeria.
Tosin Coker, Commercial Coordinator of the Presidential Compressed Natural Gas Initiative (PCNGI), commented: “Dangote Group’s acquisition of 4,000 CNG trucks is not only impressive in scale but also highly strategic. It signals to the market that CNG is no longer a distant prospect but a current, practical solution to high energy costs, emissions, and supply chain challenges. PCNGI regards this as a milestone achievement in our efforts to accelerate gas-powered transport adoption.”
The Independent Petroleum Marketers Association of Nigeria (IPMAN) also responded to the development, citing its potential to address logistical difficulties in the downstream sector.
IPMAN’s National Publicity Secretary, Chinedu Ukadike, said: “Our pipelines have been non-functional for years, yet nothing has been done to revive the infrastructure linking the country’s 21 depots. We’ve had to rely on expensive transport from coastal depots. Dangote’s intervention lifts a huge burden off the shoulders of independent marketers.”
Development economist and policy analyst Professor Ken Ife argued that the project could lower PMS prices and benefit consumers broadly.
Bismarck Rewane, CEO of Financial Derivatives Company, dismissed fears of monopoly, attributing inefficiencies in the sector to deeper structural issues.
He noted: “What Dangote is doing achieves two key objectives: delivering products across the entire country at a uniform price by eliminating bridging costs, and significantly reducing logistics expenses through the use of CNG-powered trucks to reach every corner of the nation.
“In economic terms, middlemen—who typically do not invest—are often viewed as parasitic, extracting margins simply for distributing goods. Dangote is bypassing this layer by directly handling distribution and, notably, providing credit facilities to the retail end of the business.”
Kelvin Emmanuel, energy expert and co-founder of Dairy Hills, remarked that absorbing logistics costs could allow Nigerians to begin experiencing the effects of local refining.
Energy analyst Ibukun Phillips described the model as transformative, with possible implications for rural energy access: “Rural consumers, who typically pay more despite earning less, stand to benefit immensely. This could also revive abandoned filling stations and promote equitable distribution,” she explained.