The Independent Petroleum Marketers Association of Nigeria (IPMAN) says the price of petrol will determine if it will buy from the Nigerian National Petroleum Company (NNPC) Limited or Dangote Petroleum Refinery.
According to Ukadike Chinedu, IPMAN’s National Publicity Secretary, the association is prepared to buy from either Dangote or NNPC depending on the prices they offer.
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Chinedu said the NNPC’s recent clarification that it is not the sole off-taker of Dangote products gives dealers the freedom to get their products from any cheaper source.
“Now that NNPC has said they are not the sole off-taker of Dangote petrol, it then means that the price of the product would determine where we are going to buy it. If NNPC imports the product and its price is cheaper than that of Dangote, we will buy from NNPC,” Chinedu said to Punch on Monday.
He said the situation reflects the implementation of the Petroleum Industry Act (PIA) and the government’s removal of petrol subsidy, with the pricing of petrol now determined by the principles of demand and supply.
The competition, he noted, will eventually drive down prices.
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On whether marketers had started making plans to import if the imported product is more affordable, he said Abubakar Maigandi, IPMAN’s National President, has initiated discussions with investors, with plans underway to secure funding based on the current market trends.
“So, we are talking with some foreign partners because you need to understand that independent marketers are the highest buyers of diesel from Dangote refinery because we control about 80 percent of the filling stations nationwide,” he added.
“So, if Dangote PMS is cheaper we will buy it, but if importation is cheaper, we will go for it.”
Also, Mustapha Zarma, IPMAN’s National Operations Controller, said decision to buy from Dangote or NNPC would be based on which supplier offers a better Return On Investment (ROI) and required margins.
Zarma said: “We may contact the refinery’s sales department this week to find out the price.
“If the price is competitive enough for one to buy and get his return on investment and the required margin, then we wouldn’t mind purchasing directly from him to complement what NNPC is bringing in or what NNPC would buy from Dangote.
“I believe that we are going to analyse the price of Dangote petrol and see the advantages of buying from Dangote viz-a-viz importation. Whichever we feel is cheaper will automatically attract everybody, especially if importation is cheaper.”
