Depot Owners Reject Claims of Blocking Local Refineries

• DAPPMAN rejects claims of obstructing local refineries, asserting members prioritize reliable petroleum supply and have invested in necessary infrastructure
• The association emphasizes a preference for sourcing locally in naira, aiming to reduce foreign exchange pressure and support national interests

The Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) has firmly rejected allegations that it obstructs local refineries to favour the continued importation of petroleum products.

Olufemi Adewole, DAPPMAN’s Executive Secretary, explained that the association’s members are patriotic investors who have heavily invested in building infrastructure across all sectors of the downstream value chain.

He emphasized that their primary objective is to ensure a steady and reliable supply of petroleum products throughout Nigeria.

“It’s absurd to claim that depot owners are deliberately obstructing local refineries or trying to undermine the country’s interests. Any smart entrepreneur would prefer to work with suppliers who offer competitive prices and easy product access,” Adewole stated.

“We would much rather avoid the difficult process of sourcing foreign exchange for our operations, which puts pressure on the naira. Instead, we would prefer to source all our products from local refineries using the naira, as is being considered following President Bola Ahmed Tinubu’s directive.”

Adewole noted that DAPPMAN and its members are eager to support the Dangote refinery. “As soon as the Dangote refinery began production, DAPPMAN’s leadership initiated meetings with the refinery’s management to explore supply options, driven by our excitement about this development.”

Despite being wrongly accused of opposing local refineries, he also highlighted that depot owners have already started buying products from the Dangote refinery, even though there have been some operational challenges.

Addressing claims from some oil industry stakeholders that depot owners add little value to the fuel distribution chain, Adewole defended their crucial role in the sector.

He pointed out that the final consumer cannot buy fuel directly from refineries.

“Depots serve as off-takers of large fuel volumes, which are imported on ships, paid for in foreign exchange, and distributed to branded retail outlets and independent retailers.

“Many depots also manage fleets of tanker trucks to ensure efficient distribution, countering the notion that depot owners simply inflate prices,” he said.

Adewole emphasized that those familiar with the downstream sector understand that depot owners are essential, not unnecessary middlemen.

He reiterated that depot owners would prefer to source products locally in naira, as long as the product specifications and business terms remain competitive.