Business
Over 80% of Fuel Depots Shut Down as Dangote Disrupts Market
Fuel depots and tank farm owners in Nigeria’s midstream petroleum sector are facing mounting losses, as more than 80% of their facilities have either shut down or become dormant, Business Hallmark investigations reveal.
According to data from Petroleumprice.ng — Nigeria’s leading platform for petroleum price updates, marketplace, and news — the country has 105 registered fuel depots.
Major depots in Lagos include AIPEC, OVH, Oando, Heyden, Ardova, African Terminal, Ibeto, 11 Plc, AITEO, OBAT Oil, ETERNA, NIPCO, MRS Dockyard, MRS Tincan, Sahara, NNPC, Ramaniya, Total, and DUPORT in Apapa; Pinnacle and Dangote Depots in Ibeju-Lekki; PPMC, Rainoil, and WOSBAB in Ejigbo; Techno Oil, Bovas, FATGBEMS, Lado, and SWIFT in Kirikiri; A.A Rano in Ijegun; and Conoil in Marina.
Outside Lagos, key depots include NORTHWEST, Hyde, and Mainland in Calabar (Cross River State); NIPCO Warri and Optima in Warri; PHRC and MATRIX in Port Harcourt (Rivers State); Prudent in Oghara, Delta State; and ARADEL and Rainoil in Delta.
Of the 105 facilities, 60 are located in Lagos, while the remaining 45 are spread across Delta, Rivers, and Cross River States.
Analysis from Petroleumprice.ng shows that only 24 depots — including BOVAS, AITEO, AIPEC, Pinnacle (Warri and Lagos), Ardova, MRS Tincan, Eterna, FYNEFIELD, Parker, Sigmund, Prudent Oghara, Matrix Warri, Matrix Lagos, Rainoil Lagos, Liquid Bulk, Zamson, Dangote, Bono, NIPCO Lagos, 11 Plc, Sahara, Sharon, and Eva — are currently operational as of Sunday, April 27, 2025.
These 24 active depots display real-time data on product pricing, quantity discharged, discharge dates, and loading status — critical indicators of operational status.
Notably, Dangote is offering the lowest petrol price at N835 per litre, while Sigmund tops the list with N870 per litre.
Recent stock updates show that AITEO received 37,424 metric tonnes of petrol on March 30, 2025, while BOVAS took delivery of 20,000 metric tonnes on March 4, 2025.
In contrast, the 81 inactive depots show no real-time pricing, product discharge, quantity, or loading information — clear signs of inactivity on both their platforms and major industry intelligence channels.
Sources in the industry indicated that as of Sunday, April 27, 2025, the depots did not have any petroleum products in their tanks. Out of 24 fuel loading depots still in operation, at least five, including Heyden, Eterna, Ardova, MRS, and Dangote, source their products from Dangote Refinery. Some idle and dormant depots last received petroleum products back in January 2024.
In percentage terms, only 24 (about 20 percent) of the listed fuel depots across Nigeria are currently active, while the remaining 81 (representing 80 percent) are either idle or permanently shut down. The troubles for these depots began in May 2023, when the current administration terminated the controversial fuel subsidy regime. This abrupt change, alongside a spike in petrol prices, led to a significant drop in demand, causing a steep decline in fuel imports and rendering many depots redundant.
The situation for tank farm owners worsened further with the launch of Dangote Refinery in Ibeju-Lekki, Lagos. With the refinery’s products hitting the market, locally refined petroleum became more cost-effective than imported fuel, leaving marketers struggling to compete. The tank farm and fuel depot business had initially thrived since the 1990s due to declining performance from the country’s four public refineries. The Nigerian National Petroleum Company (NNPC), now NNPCL, began importing fuel to close the supply gap.
As part of maintaining fuel security, the Federal Government mandated that a 90-day supply of products must be kept on hand to prevent crises. This encouraged private sector involvement in fuel importation and the development of storage facilities. Banks joined the fray by offering loans for building additional storage tanks and pipelines. Within a decade, the number of active depots surged from 20 to over 100, generating substantial revenue and creating many wealthy investors.
However, the removal of fuel subsidies and the operationalization of Dangote Refinery have drastically disrupted the tank farm business, with many investors facing serious threats as direct refinery supplies flood the market. The entrance of Dangote’s diesel and petrol resulted in a significant drop in prices; for example, diesel prices, which were between N1,700 to N1,900 in 2023 and early 2024, have reduced to around N1,050 to N1,100. Similarly, petrol prices have declined from highs of N1,400 in 2024 to more competitive rates.
Industry experts note that Dangote Refinery’s entry effectively diminished the need for extensive bulk purchases and long-term storage, as local production can meet the market’s demands more efficiently. They highlight that with local production, the necessity to stockpile petrol and diesel for long durations has reduced significantly. Currently, the optimal storage might only need to last one or two weeks, as anything longer becomes a financial burden on consumers, who pay a storage fee with every litre of petrol purchased.
“However, since marketers can get fuel daily from functioning refineries, there is no longer a need for massive storage tanks, which come at a huge cost to construct and maintain.
“Dangote Refinery can have limited storage tanks to hold products for a few days or weeks. But the longer the products spend in storage, the more consumers will pay in storage fees.
“That’s why Dangote cried out last year that he had over 500 million litres of petrol lying idle in his tanks. He now seems to be winning the war against marketers bent on importing fuel”, a source stated.
Also speaking, the Public Relations Officer of IPMAN’l, Chinedu Ukadike, said that relying on depot owners for products is no longer viable, especially when direct purchases from Dangote Refinery are possible.
“The minimum quantity to buy from Dangote Refinery is two million liters, which comes down to N835 per liter. We can also buy from MRS, which also distributes Dangote’s petrol”, he said.
BH checks revealed that Dangote currently supplies more than 30 million litres of petrol daily to marketers, which amounts to 210 million liters weekly and 840 litres monthly.
These figures indicate that embattled fuel depots and tank farm owners have lost about 50 percent of their local market to Dangote Refinery.
A reliable source in one of the tank farms located in Ijegun, a suburb of Lagos, who did not want his identity disclosed because he did not have the authorization to speak, said millions of tonnes of petroleum products are currently sitting idle in private depots in Lagos with no buyer in sight.
The few products the depots are able to sell, the source claimed, are the ones purchased by filling stations owned by owners of the depots, as well as independent marketers without the financial muscle to buy in bulk from Dangote Refinery.
“You are well aware that most depots and farm tank owners are also stakeholders in the downstream petroleum sector who own their own filling stations.
“However, they still need the patronage of independent marketers to break even as their outlets account for less than 10 percent of their market”, the source lamented.
The owners of these tank farms, financial experts argue, will be faced with tough decisions by half year 2025 — either pack up and sell the fuel storage tanks as scraps or continue in business and fall into financial ruin.
Depot and tank farm owners under the aegis of Jetty and Tank Farm Owners Association of Nigeria (JEPTON) and Depot and Petroleum Products Marketers Association (DAPMA) had last year expressed concerns about the negative impacts of allowing Dangote Refinery to sell fuel directly to marketers at its 2,900 tankers capacity loading gantry.
Speaking to BH on their fears, the tank farm owners argued that Dangote’s plan to sell fuel directly to retailers will deepen their economic woes.
According to the tank farm owners, allowing Dangote Refinery to allow trucks to load products at its facility is tantamount to giving the firm a backdoor licence to do retail marketing.
“Some of our members have multiple storage tanks that can accommodate 4 million litres. This means that just one tank can supply 121 (one hundred and twenty-one) 33,000-litre trucks.
“We have invested billions of dollars in building jetties, pipelines, and storage tanks to hold petroleum products over time.
“Dangote venturing into the fuel retail business is crowding us out, leading to huge debts and loss of investments”, a tank farm owner in Ijegun, who did not want his identity disclosed, had told BH in 2024.