Several oil marketers in Nigeria are reportedly ending their franchise agreements with the Nigerian National Petroleum Company Limited (NNPCL) as competition in the fuel market intensifies. Many filling stations that once displayed the NNPCL logo are now rebranding under private ownership, especially in Lagos and its surrounding areas.
The shift comes as the $20 billion Dangote Petroleum Refinery in Lekki reduces its fuel prices, making it more attractive for independent marketers. Sources revealed that some stations along the Lagos-Ibadan Expressway, including areas like Wawa and Ibafo, have already removed the NNPCL name and switched to alternative suppliers.
Industry experts note that independent marketers are looking for cheaper fuel options to boost sales and profits. Since the government deregulated the oil sector, the competition has grown tougher, forcing marketers to seek the best deals. Many dealers who previously relied on NNPCL for supply are now turning to Dangote and other sources offering lower prices.
The recent move by the Dangote refinery to lower its loading cost for Premium Motor Spirit (PMS) from N950 to N890 per litre has further fueled the competition. With the landing cost of imported petrol still high, many marketers find it more profitable to buy locally refined fuel.
Chinedu Ukadike, the National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), confirmed that marketers are rebranding their stations to take advantage of better pricing options.
He explained, “Yes, that observation is correct. Some marketers are changing and rebranding. Remember that there was a time NNPCL was the sole distributor and importer of petrol. So, marketers then gave their filling stations as franchises so that they could get products.
“So marketers normally give their companies to NNPCL to be able to have petroleum products. But now that the game has changed, you can even see some marketers now changing to MRS filling stations. Because MRS is now selling cheaper than any other station.”
In the past, many independent marketers acquired franchise licenses from NNPCL to secure steady fuel supply at competitive rates. However, with Dangote’s entry into the market, that strategy is no longer as beneficial. Experts note that some marketers initially paid millions to get NNPCL franchise licenses, but now they see better opportunities elsewhere.
Industry analyst Olatide Jeremiah told PUNCH that marketers previously used the franchise system to gain access to cheaper petrol. However, he noted that the introduction of the Dangote refinery changed the dynamics, making direct purchases more viable.
He said, “The franchise licence was also an avenue to make more profit because some marketers got licences for one of their stations but would transport products to other stations and sell at a higher price to Nigerians.”
The ongoing fuel price competition is expected to lead to even more rebranding of filling stations. Experts predict that as long as Dangote offers lower prices than imported fuel, more marketers will leave NNPCL to seek better deals.
