Dangote Refinery suspends discount fuel scheme over widespread diversion fraud

The Dangote Petroleum Refinery and Petrochemicals has suspended its discounted fuel supply initiative following the discovery of widespread misuse by some of its affiliate marketers and strategic partners.

An internal investigation revealed that discounted petroleum products, intended to boost affordability and stabilize nationwide supply, were being rerouted by some partners to unauthorized third-party marketers. These marketers, the refinery said, took advantage of the discounted rates, diverting the products and reselling them at higher market prices for personal gain.

The scheme was initially designed to support registered Dangote affiliate marketers, ensuring competitive margins and consistent fuel availability across the country. But instead, the system was reportedly being exploited.

According to findings, certain partners were selling their Authority To Collect (ATC) loading tickets to unregistered marketers who bypassed logistical and operational costs—turning quick profits by selling directly from the refinery.

READ ALSO:Marketers kick as Dangote vows to crash cooking gas price

The refinery stated that these diverted products were frequently resold at prices much higher than the agreed subsidised rates, distorting the downstream market and undermining the goals of the discount initiative.

A directive to halt the scheme was issued to strategic partners on July 13, 2025, in a letter signed by Group Executive Director, Commercial Operations, Fatima Dangote. The letter, obtained by our correspondent, explained the reasons behind the decision and outlined next steps.

“In our drive to ensure the distribution and retail sale of DPRP refined petroleum products across your service stations nationwide, DPRP commenced the strategic partnership scheme with the sole aim of ensuring consumers nationwide have access to affordable and clean petroleum products,” the letter read.

“Unfortunately, over the last few months, DPRP has been receiving unprecedented complaints of Strategic Partners (Partners) selling their ATCs at the refinery (Tarmac) below the prevailing PMS gantry product price. Whilst we have engaged Partners severally on this, it has become evident that this has become an area of grave concern to DPRP as it affects the sustainability of our gantry operations.To this end, DPRP Management is suspending the discounted price offered to Partners effective 13th July 2025 and working towards restructuring the scheme.”

Despite the suspension, the refinery offered limited concessions. Any product release notes (PRNs) issued before the cut-off date would still be honored, and partners who had already completed payment for discounted products would continue to receive them at the agreed rates.

“Furthermore, please note the following: All existing PRNs at partner prices will remain valid for loading, any Partner awaiting PRN for payment made at Partner price before the effective date will receive the same. Recommended pump prices across the retail stations should still be adhered to,” the company stated.

The Dangote refinery reaffirmed that, while the current scheme is paused, the broader strategic partnership remains intact. A revised reward system for partners is reportedly in development.

Industry expert Olatide Jeremiah confirmed the abuse of the discount system. He explained that some registered marketers, who were granted access to load products from the refinery at subsidised rates, were reselling them to non-affiliated players for quick profit.

“The information is true. It is the affiliated marketers to Dangote who have the ticket to load products at the refinery are the ones selling it to other marketers, basically to make a quick profit. Dangote has a discount scheme for its customers, so that they can make money from the sales of petroleum products at their stations.So instead of selling it at the station, they would sell it to other marketers and depot owners, below the normal price at the gantry, but at the price range with amount importing marketers are selling. For instance, if Dangote is giving its registered customers its products at a discounted price of N815, below the publicly announced price of N825. The marketers are now selling at N819, bypassing other expenses, slow sales, and making a quick profit of N4 per litre, and still have enough margin for the receiving marketer to sell at the normal rate of N825 per litre.This is also different from extra products received on credit to ensure adequate supply across the nation. There is an agreement with Dangote allowing its partners to receive volumes above the amount paid for, so that they can sell at a particular rate and refund them. This was to ensure circulation at retail stations. But these marketers would receive the products and sell them immediately to unregistered marketers. So they have suspended the scheme and are selling at the normal rate, but they said it would be restructured.”

Despite the suspension, a price comparison from petroleumprice.ng showed that independent marketers, who rely solely on imported fuel, were still selling at similar rates as those receiving discounts from Dangote.

As of last week, five private depots had aligned their rates with Dangote’s adjusted price, averaging N820 per litre—down from N835 at the beginning of the week.

While the refinery did not name specific defaulting marketers, a list of current strategic partners includes MRS Oil, Heyden Petroleum, Ardova Plc, Hyde Energy, Optima Energy, Techno Oil, TotalEnergies, Garima Petroleum, Sunbeth Energies, Sobaz Nigeria Ltd, Virgin Forest Energy, Sixxco Oil Ltd, NU Synergy Ltd, and Soroman Nigeria Ltd.

When contacted for comment, Dangote Group’s Head of Corporate Communications, Anthony Chiejina, said more time was needed before issuing an official response, clarifying that there was no formal dispute between the refinery and its marketing partners.

(PUNCH)