- Cites Monopoly, Job Losses, Others As Likely Consequences
By Kolawole Ojebisi
The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has expressed scepticism about the Dangote Refinery’s forward integration adoption, saying that the move may negatively affect the country’s economy.
The association maintained that instead of achieving the intended positive objectives, the plan may worsen Nigeria’s already harsh economy.
It further claimed that the plan could be a plot to monopolise the oil sector by the Dangote refinery.
This is contained in a statement signed by Joseph Obele, PETROAN’s national public relations officer, on Monday.
According to the statement, PETROAN said the development could also pose a significant job loss threat to Nigeria.
“The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has raised concerns about Dangote Refinery’s forward integration adoption, warning that it could lead to a monopoly in disguise and pose a significant job loss threat to Nigeria,” the statement read.
The statement continued: “With a production capacity of 650,000 barrels per day, PETROAN argues that Dangote Refinery should be competing with global refineries, not operating as a distributor in the downstream sector.
“This massive refinery, one of the largest in sub-Saharan Africa, is expected to satisfy domestic fuel demand and export surplus products.”
According to the statement, PETROAN had earlier said it raised alarms about Dangote’s plans to dominate the downstream sector, citing concerns that the company may use its market power to fix prices, limit competition, and exploit consumers, “much like it has in other sectors.”
PETROAN further warned: “This could lead to a massive shutdown of filling stations across Nigeria, resulting in widespread job losses.”
The New Diplomat had reported on Sunday, how Dangote refinery said it would begin nationwide distribution of diesel and premium motor spirit (PMS), also known as petrol, on August 15.
With this planned move, the indigenous facility will bypass middlemen to transact businesses directly with end-users of its products.
