Fuel war: NNPC Retail buckles under vicious Dangote/MRS challenge 

– Faces mounting financial strain as sales crash, partners exit franchise deal in droves

The refined petroleum products retail arm of the Nigerian National Petroleum Company Limited (NNPCL), NNPC Retail, is facing growing financial pressure and redundancy as it loses ground to Dangote Refinery and its partners in the battle for control of Nigeria’s downstream petroleum sector, Business Hallmark can report.

According to BH findings, the national oil company has become a shadow of its former self. Many of the firm’s branches across the nation are now rundown and looking desolate as a result of low sales and resultant loss of revenue.

Many other branded NNPC Retail stations have changed names and colors after exiting a franchise deal with the struggling national oil company.

NNPC Retail, it would be recalled, was the biggest player in the nation’s midstream and downstream petroleum sector.

After the first forex crisis that started during the administration of late President Muhammadu Buhari between 2016 and May 2020, which forced oil marketers to withdraw from fuel importation, NNPCL became the sole importer and supplier of refined petroleum products in the country to ensure energy security.

From Sole Supplier to Major retailer

Apart from supplying marketers, both major and independent, the national oil company also expanded its retail arm, NNPC Retail, building new branches and buying up existing oil trading companies like Oando Oil.

Within the spate of four years, NNPC Retail displaced industry leaders like Mobil and TotalEnergies to become the biggest player in Nigeria’s downstream petroleum sector with over 850 outlets.

However, with the coming on board of the 650,000 barrels per day capacity Dangote Refinery in the Ibeju-Lekki area of Lagos, the picture has changed drastically.

With the fuel produced by the Dangote Refinery cheaper than the ones imported by NNPCL and oil marketers, the old business model of importing has become unviable, posing a threat to the continued viability of the NNPCL subsidiary.

According to available data, the gantry and coastal prices of a liter of petrol from the Dangote Refinery cost N699 and N684 respectively, compared to the landing cost of imported petrol, which stands at N877 as of 9th January, 2026, according to data supplied by the Major Energies Marketers Association of Nigeria (MEMAN).

With NNPC Retail and marketers’ imported fuel unable to compete with cheaper Dangote fuel, demand for their products fell as many petrol marketers switched over to Dangote Refinery for their stocks.

Also, Dangote Refinery-partner stations, especially MRS, owned by Alhaji Aliko Dangote’s half brother, Sayyu Idris Dantata, currently offers petrol for sale to motorists at cheaper rates of N733 to N740 in Lagos, compared to NNPC Retail’s pump prices of N740 to N785.

Sources in the nation’s downstream petroleum sector informed our correspondent that fuel marketers in partnership with NNPC Retail have been incurring huge losses as the pump prices of their refined petroleum products become uncompetitive on the back of Dangote Refinery’s constant price adjustments.

All About Price

According to BH findings, volumes of petrol sold at NNPC affiliate stations have crashed by over 60 percent on the heels of Dangote Refinery’s price reviews.

However, competitors like MRS, Ardova and Heyden that get their supply from Dangote Refinery are benefiting from the loss of market share by NNPC- stations and marketers that import fuel.

Owing to low patronage and recurring losses, NNPCL Retail stations, BH learnt, had suspended investment in construction and acquisition of new outlets.

The manager of an NNPC Retail station in the Iju area of Lagos, who did not want his identity disclosed, said the station had  seen its profits tumble in the last  one year.

“Owing to several factors, especially the challenge posed by Dangote Refinery’s entry into the Nigerian petroleum market, our profit margins have been eroded.

“You can see that we (NNPC Retail) recently have been on the receiving end of Dangote’s price adjustments. Each time we brings in fuel from abroad, Dangote will strike by lowering his own prices, making our own products uncompetitive.

“The truth of the matter is that NNPC stations and its affiliates  cannot favorably compete with Dangote partnered-stations.

“Our parent company (NNPCL) is an importer of petroleum products, which it supplies to us at a very unfair price, leaving us with low sales and heavy losses.

“Our major problem now is vanishing market. Given the cheaper Dangote fuel that have flooded the nation, our market share have been eroded.

“Many fuel stations that signed franchise deal with NNPC have moved on. The exodus began a long time ago when NNPCL started failing to guarantee supply.

“The problem has been exacerbated by the distorting entry of Dangote’s fuel, especially his PMS and LPG.

“I won’t be surprised if more marketers abandon the NNPC partnership. They are not immune to the shock unlike NNPC owned stations that are heavily subsidized and provided for by the national oil company. Even that arrangement can not be sustained much longer,” the source stated.

One of the NNPC Retail stations  undergoing rebranding is the Omole Estate, Ogba outlet. The mega branch is currently undergoing repairs and change of name to Sentax, it’s original owners.

Annual Report Speaks

Presenting its full year 2023 financial report at the NNPC Towers, Abuja in October 2025, the NNPCL board listed NNPC Retail as one of the unviable and unprofitable subsidiaries that pushed the national oil firm’s indebtedness to N22 trillion.

The report suggests that the fuel retail subsidiary may be facing a serious financial sustainability and liquidity management crisis.

Though, NNPC Limited is yet to release the financial performance of its subsidiaries in the 2024 and 2025 financial years, experts predict a worse performance for the struggling company in the operating years.

Meanwhile, industry stakeholders have demanded the shutdown of NNPCL’s unprofitable ventures, arguing that their continued existence is unjustifiable.

According to an oil and gas expert, Dan Kunle, core investors should take over NNPCL’s non-performing entities, otherwise the projected gains of the Petroleum Industry Act (PIA) would remain elusive.

“The subsidiaries should be privatized. The core share of those subsidiaries should be in the hands of private investors. They destroyed the industry completely. This destruction should make every state in the country begin to look for what they can do”, Kunle said.

The expert warned that it may be very difficult for investors to bring in their funds and revive the oil sector if under performing subsidiaries are left in the hands of NNPCL longer than necessary.