Dangote’s ₦720bn CNG Investment to Save Nigerians ₦1.7trn, Empower 42 Million MSMEs

Dangote’s ₦720bn CNG Investment to Save Nigerians ₦1.7trn, Empower 42 Million MSMEs

Presidency, IPMAN, Industry Experts Applaud Game-Changing Fuel Distribution Strategy

In a landmark move poised to transform Nigeria’s downstream petroleum sector, the Dangote Petroleum Refinery has unveiled a ₦720 billion investment in Compressed Natural Gas (CNG)-powered logistics to deliver petroleum products nationwide—at zero cost to fuel marketers.

The initiative, which involves the deployment of 4,000 CNG-powered trucks, is projected to save Nigerians over ₦1.7 trillion annually by absorbing a staggering ₦1.07 trillion in fuel distribution costs. The move is set to ease inflation, lower pump prices, revive dormant filling stations, and significantly reduce the operational costs of over 42 million Micro, Small, and Medium Enterprises (MSMEs) across the country.

Beginning August 15, the Dangote Refinery will commence direct delivery of petrol, diesel, and aviation fuel to filling stations, industrial consumers, and other large-scale users. The refinery aims to meet Nigeria’s daily demand of 65 million litres—comprising 45 million litres of Premium Motor Spirit (PMS), 15 million litres of diesel, and 5 million litres of aviation fuel.

With average logistics costs at ₦45 per litre, the Dangote Group’s plan to cover the distribution cost represents a massive intervention in a sector long burdened by inefficiencies, costly transportation, and inconsistent pricing.

The investment will also include the establishment of nationwide CNG ‘mother and daughter’ refilling stations to support the trucks and foster the adoption of cleaner energy alternatives.

According to the company, the initiative aligns with its broader strategy to improve energy efficiency, tackle supply bottlenecks, promote environmental sustainability, and support Nigeria’s economic recovery.

Over 15,000 jobs are expected to be created across the logistics chain—from drivers and mechanics to station managers and attendants—while the revitalization of abandoned fuel stations will stimulate economic activity in rural and underserved areas.

Presidential, Industry Endorsements

The Presidency has hailed the initiative as a major boost to Nigeria’s transition toward gas-powered transportation. Commercial Coordinator of the Presidential Compressed Natural Gas Initiative (PCNGI), Mr. Tosin Coker, described the move as "a vote of confidence in Nigeria’s gas-driven future."

“Dangote Group’s acquisition of 4,000 CNG trucks is not only impressive in scale but also strategic. This development sends a clear signal that CNG is no longer a future concept—it is today’s solution to high energy costs and systemic inefficiencies,” Coker said.

The Independent Petroleum Marketers Association of Nigeria (IPMAN) has also commended the effort. Speaking on behalf of the association, National Publicity Secretary Chinedu Ukadike said Dangote’s direct delivery model will reduce the burden on independent marketers who have for years grappled with poor pipeline infrastructure and high transportation costs.

“Our pipelines have been dormant for over a decade. Dangote’s intervention is a welcome relief that will significantly reduce our overheads and improve access to affordable fuel,” Ukadike noted.

Analysts Predict Sector-Wide Transformation

Economic and energy experts have described the initiative as revolutionary, capable of disrupting the status quo and repositioning Nigeria’s energy landscape.

Development economist and policy analyst, Professor Ken Ife, said the intervention would bring down PMS prices and trigger widespread economic benefits.

CEO of Financial Derivatives Company, Mr. Bismarck Rewane, downplayed concerns of monopolistic control, arguing that the current system has long been plagued by middlemen who add costs without value.

“What Dangote is doing is transformative—it eliminates bridging costs, introduces uniform pricing nationwide, and removes parasitic middlemen by managing distribution directly and offering credit to retailers,” Rewane said.

Energy expert and co-founder of Dairy Hills, Kelvin Emmanuel, added that the refinery’s decision to absorb logistics expenses may finally enable Nigerians to reap the true benefits of domestic refining.

Ibukun Phillips, an energy analyst, described the strategy as “revolutionary,” especially for rural dwellers.

“Rural Nigerians often pay more for fuel despite earning less. This programme levels the playing field, revives abandoned outlets, and makes energy more accessible across board,” she said.

As the nation anticipates the rollout of the CNG-powered distribution system, the Dangote Group’s unprecedented investment underscores a strong private-sector push toward affordability, sustainability, and inclusive economic growth.