Bismarck Rewane Highlights How Dangote's N720bn Initiative Will Lower Inflation, Boost Economy

• A renowned economist has praised Dangote Petroleum Refinery's initiative to deploy 4,000 CNG-powered trucks for nationwide fuel distribution
• The program will provide direct fuel supply to stations, benefiting over 42 million MSMEs, reducing energy costs, and creating 15,000 new jobs
• The expert dismissed concerns about a potential monopoly, emphasizing the initiative’s focus on overcoming industry inefficiencies

Legit.ng journalist Victor Enengedi has over a decade's experience covering Energy, MSMEs, Technology, Banking and the Economy.

Bismarck Rewane, CEO of Financial Derivatives Company, has highlighted that the company's latest initiative aimed at free distribution will lower production costs, reduce inflationary pressures, and promote economic growth.

This follows Dangote Petroleum Refinery's recent investment of over N720 billion to launch an ambitious plan of deploying 4,000 Compressed Natural Gas (CNG)-powered trucks for the nationwide distribution of petroleum products, expected to save Nigerians more than N1.7 trillion each year.

The initiative has received widespread praise from energy experts, some of whom have called it one of the most significant developments in the sector since Nigeria's independence.

Rewane said that Dangote is bypassing middlemen, who are seen as parasitic, by directly managing distribution and offering credit facilities to retailers.

He said:

“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."

Rewane, however, downplayed concerns over the refinery potentially dominating the market, pointing out that inefficiencies in the industry have been a long-standing issue.

Impact of Dangote's CNG project

Tribune reports that starting from August 15, Dangote will directly supply petrol and diesel to filling stations, industrial facilities, and large consumers.

This bold step will see the privately owned refinery absorbing more than N1.07 trillion in annual fuel distribution costs.

The initiative is set to significantly benefit over 42 million Micro, Small, and Medium Enterprises (MSMEs) by reducing energy expenses and boosting profitability.

The project is also expected to revitalize dormant filling stations, generating employment opportunities.

An estimated 15,000 direct jobs will be created across the logistics sector, including roles for drivers, station managers, and attendants at CNG stations.

In its statement, the company said the initiative is a key element of Dangote’s wider dedication to overcoming logistics challenges, improving energy efficiency, fostering environmental sustainability, and contributing to Nigeria’s economic growth.

FG issues additional refinery licenses

In related news, the Nigerian government issued 47 Licenses to Establish (LTE) and 30 Licenses to Construct (LTC) refineries over the past year.

This initiative, as reported by Legit.ng, is aimed at boosting the country's refining capacity and ensuring a consistent supply of petroleum products.

Farouk Ahmed, the Chief Executive Officer of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), stated that these 47 licenses are projected to deliver a combined refining capacity of nearly three million barrels per day.

Source: Legit.ng