September 06, (THEWILL) – Industry stakeholder and Chairman of Integrated Oil and Gas Ltd., Capt. Emmanuel Iheanacho (rtd), has countered the call by billionaire businessman and Chairman of Geregu Power Plc, Mr. Femi Otedola, for petroleum marketers in the country to dismantle their depots and sell them as scrap.
This followed the historic commencement of petrol production by Dangote Refinery, which Otedola said would redefine the oil and gas industry and render the storage facilities of the marketers redundant.
In a statement on Thursday, Iheanacho maintained that the depot facilities remain critical elements in the industry, considering the indispensable role of depot owners in Nigeria’s fuel supply chain.
He emphasised that the role of the depot owners would be more strategic in the context of the delivery of petrol by the 650,000 barrels per day Dangote Refinery which has commenced production.
THEWILL recalls that Otedola had in a post on his X handle on Tuesday, suggested that Nigerian depot owners should dismantle their facilities and sell them as scrap, given the arrival of Dangote’s petrol.
Otedola made the comment shortly after a live broadcast by the President of Dangote Group, Aliko Dangote, who displayed samples of petrol produced from his $20 billion refinery.
Iheanacho explained that petroleum products storage depots were a vital component of the fuel supply chain complementing primary fuel sources, adding that without these depots, other elements in the supply chain would struggle to deliver fuel to consumers.
“While there might be competitive elements in the market, collaboration and cooperation are essential for ensuring a stable fuel supply in Nigeria.
“Petroleum depots are not a replacement for primary fuel sources but are crucial for storing and distributing products to meet demand,” Iheanacho said.
He added that depots play an important role in distribution, particularly given Nigeria’s dispersed infrastructure.
He also noted that while private depots may compete with the Nigerian National Petroleum Company (NNPC) Limited in terms of storage and distribution, they were not necessarily in direct competition with the NNPCL or Dangote Refinery.
Iheanacho, who is also a member of the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN), explained that the depots often work in conjunction with other stakeholders to support a reliable fuel supply chain.
He emphasised that depots provide critical storage and distribution support not only for NNPCL and Dangote Refinery but also for petroleum importers, ensuring a more efficient and reliable fuel supply network.
“Private depots may compete with petroleum importers for market share by offering essential storage and distribution services.
“Ultimately, competition aims to balance market prices. However, depots are key partners in supporting the entire supply chain, including NNPC and Dangote,” he said.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
