Middlemen sidelined as bulk buyers get direct supply from Dangote refinery
Bulk fuel consumers and filling stations have begun to abandon middlemen suppliers to get free delivery from Dangote refinery. This was stated during a live programme on TVC by the President of the National Association of Road Transport Owners (NARTO), Yusuf Othman.
Othman who decried the development stated that members of NARTO have up to 30,000 trucks and cannot, business-wise, distribute fuel free of charge.
“We have our members who have signed agreements with so many companies. Some are even informal agreements, but we have formal agreements signed, and by that, we used those formal agreements to collect bank facilities to buy trucks and serve those companies. But now, those agreements are at stake because a big brother is coming to supply directly to them, not minding the fact that they have signed agreements with us.
“Though they have not officially informed us, and it’s not officially confirmed. The information available to us showed that this is ongoing, and as such, our trucks will not be used again. That is one of the reasons why so many of our members are complaining. If I sign an agreement with you for service by virtue of my 10 trucks, and somebody somewhere comes to do the same thing for you for free, it’s a very delicate situation,” he said.
Othman further appealed to Dangote to consider the survival of other players in the sector.
Before now, bulk buyers like telecom companies and others sought fuel from middlemen. The Dangote free fuel distribution scheme seemed to have changed the status quo as buyers now apply for direct supply to save costs, cutting out middlemen in the process.
Reports say that 1,000 compressed natural gas-powered trucks out of the 4,000 ordered by the Dangote refinery have been delivered. These initial deliveries are to be deployed to Lagos, Ondo, Ogun, Ekiti, Oyo, Osun, Edo, Edo, Delta, Abuja, Rivers and Kwara. The development has led to a drop in fuel prices to between N841 and N851 per litre.
In a statement, Dangote refinery group said: “The first phase of the deployment will cover the Federal Capital Territory, Lagos, Kwara, Delta, Edo, Rivers, and South-West states, with nationwide expansion planned as additional trucks are delivered.”
