The Dangote Refinery has unveiled plans to deploy 4,000 Compressed Natural Gas (CNG)-powered trucks for nationwide distribution of petroleum products, an initiative projected to save Nigerians over N1.7 trillion yearly and ease inflationary pressures on households and businesses.

In a statement on Sunday, the refinery said the move, backed by a N720 billion investment, would see the company absorb an estimated N1.07 trillion yearly in fuel distribution costs, eliminating transportation charges for fuel marketers and large-scale consumers.

With an average logistics cost of about N45 per litre, the initiative is expected to cut pump prices, revive dormant filling stations, and stimulate growth for over 42 million Micro, Small and Medium Enterprises (MSMEs) through lower energy costs.

Effective 15 August, Dangote will begin direct delivery of petrol, diesel and aviation fuel to filling stations, industrial users, and other high-volume consumers nationwide.

The company aims to meet the country’s daily demand of 65 million litres of refined products, comprising 45 million litres of Premium Motor Spirit (PMS), 15 million litres of diesel and 5 million litres of aviation fuel.

To support the programme, Dangote Group said it is investing heavily in CNG infrastructure, including ‘mother and daughter’ stations across the country. The rollout is expected to create over 15,000 direct jobs for drivers, station managers and attendants.

The Presidency described the initiative as a major boost to the Federal Government’s push for gas-powered transportation. Commercial Coordinator of the Presidential Compressed Natural Gas Initiative (PCNGI), Tosin Coker, said the project signals confidence in Nigeria’s gas transition plan.

“Dangote Group’s acquisition of 4,000 CNG trucks is not only impressive in scale but also highly strategic.

It signals to the market that CNG is no longer a distant prospect but a current, practical solution to high energy costs, emissions, and supply chain challenges. PCNGI regards this as a milestone achievement in our efforts to accelerate gas-powered transport adoption,” Coker said.

Industry stakeholders also welcomed the development. The Independent Petroleum Marketers Association of Nigeria (IPMAN) described it as a timely intervention to address persistent logistics challenges in the downstream sector.

IPMAN’s National Publicity Secretary, Chinedu Ukadike, noted that the new distribution model would ease the burden on independent marketers who have struggled with high transport costs due to non-functional pipelines and depots.

“Our pipelines have been non-functional for years, yet nothing has been done to revive the infrastructure linking the country’s 21 depots. We’ve had to rely on expensive transport from coastal depots. Dangote’s intervention lifts a huge burden off the shoulders of independent marketers,” he said.

Development economist, Professor Ken Ife, said the initiative could help reduce the price of PMS while CEO, Financial Derivatives Company, Bismarck Rewane, dismissed concerns about the refinery becoming a monopoly, arguing that inefficiencies in the sector have been systemic and long-standing. He added that the scheme would help curb the parasitic role traditionally played by middlemen.

“What Dangote is doing achieves two key objectives: delivering products across the entire country at a uniform price by eliminating bridging costs, and significantly reducing logistics expenses through the use of CNG-powered trucks to reach every corner of the nation.

“In economic terms, middlemen—who typically do not invest—are often viewed as parasitic, extracting margins simply for distributing goods. Dangote is bypassing this layer by directly handling distribution and, notably, providing credit facilities to the retail end of the business,” he said.

Energy expert and co-founder of Dairy Hills, Kelvin Emmanuel, described the move as a potential turning point for the local refining sector, while Energy analyst Ibukun Phillips described the move as “revolutionary”, suggesting it could reshape Nigeria’s energy sector by improving affordability and access, particularly in rural communities.

“Rural consumers, who typically pay more despite earning less, stand to benefit immensely. This could also revive abandoned filling stations and promote equitable distribution,” she explained.

Dangote Group said the initiative aligns with its broader plan to tackle logistics bottlenecks, promote environmental sustainability, and support Nigeria’s economic development through lower production costs and stable fuel supply.