Otedola backs Dangote, says DAPPMAN’s business model ‘is crumbling’

Femi Otedola, billionaire businessman, says the Depot andPetroleum Products Marketers Association of Nigeria (DAPPMAN) needs to evolve anew business model as depots are going out of fashion. In a statement issued on Monday, Otedola also praisedPresident Bola Tinubu for having the courage to deregulate the downstreamsector. “Nigeria now has over 4 million metric tons of storagecapacity, most of it idle. With the Dangote Refinery now supplying fuellocally, the old business model is crumbling,” he said. THE FULL STATEMENT Congratulations to my dear brother, Aliko Dangote, on thesuccess achieved so far since the Dangote Refinery commenced operations. It isa historic leap for Nigeria’s energy independence and economic future. But more importantly, credit must go to President Bola AhmedTinubu for doing what no other leader before him had the political will toexecute, the full deregulation of the downstream petroleum sector. Thissingular act has broken the grip of entrenched interests and ushered in a newera of transparency, healthy competition, and customer-centric servicedelivery. In a sector long plagued by rent-seeking, subsidy fraud, productdiversion, and smuggling, this reform marks a decisive break from the past andlays the foundation for a more efficient and accountable energy market. Yet despite this progress, there are still voices clingingto the old ways. Voices determined to resist change, even when it’s clear thetide has turned. I’ve followed recent commentary around fuel supply issuesand feel compelled to provide some perspective, especially as it relates to thefuture of this country, which remains threatened by entrenched cabals who stillbelieve they can block the winds of reform. But history has shown time and again: you can delay change,frustrate it, even sabotage it but you can never stop it. I founded DAPPMAN in2002 (23 years ago) with a clear mission, to challenge the dominance of themajor marketers and give independent depot owners a fair platform to thrive. I personally structured the group, appointing the lateGeorge Enenmoh, then MD of Ascon Oil, as Chairman, while I served as ViceChairman and Sayyu Dantata as Secretary. At the time, depot ownership wasstrategic. We were filling critical supply gaps left by an inefficient system. But times have changed. Many of the original players haveexited the scene, and those left are clinging to assets that no longer reflecttoday’s business realities. I advised some of them as far back as last year tosell their depots as scrap while they still had value. Nigeria now has over 4million metric tons of storage capacity, most of it idle. With the DangoteRefinery now supplying fuel locally, the old business model is crumbling. Zenon Oil pioneered the modern diesel business in Nigeriaand grew to become the largest supplier in the country. We built depots tostore our imported diesel because the market was import-driven and riddled withinefficiencies. But with Dangote’s refinery fully operational, those gaps nolonger exist. We now have domestic production and local supply efficient,reliable, and proudly Nigerian. Furthermore, we must not fail to recognise theattendant benefits of eliminating the grid lock around the Ibafon , Tincan andApapa areas due to the operations of the Dangote Refinery. More than just producing fuel, Aliko has elevated the entirelogistics chain. He has purchased 8,000 brand new CNG eco-friendly trucks thatwill distribute across the country with less pollution and fewer breakdowns,unlike the aging, rickety trucks still used by some operators. I know thisbusiness intimately. I was king of it and at the peak of it in 2005 (20 yearsago) , I was conferred with the life patron of the PTD (Petrol Tanker Drivers)union by Mr Akinlaja. So, when I say the game has changed, I speak from deepexperience. What is DAPPMAN fighting for today? To preserve a modelbuilt on fuel imports, subsidy exploitation, and outdated infrastructure? Thatera is fast disappearing. The setting up of depots was mainly to collect PFIs.No depots, No PFIs from NNPC who were sole suppliers of gasoline at the timeand which thus led to the breeding of complacent importers whose sole agendawas on arbitrage and subsidy margins. Since PFI is gone, I see no reason whyDangote Refinery should subsidize DAPPMAN with N1.5 trillion which they areasking Dangote Refinery to pay and subsequently pass this cost to consumers. Isalute the courage of my brother Aliko Dangote, like Amazon Incorporated inbringing about transformative change in the downstream sector. On subsidy, I personally warned President Goodluck Jonathanthat he was being misled. The system was built to benefit depot owners, andDAPPMAN members became the primary beneficiaries. Over ₦2 trillion was siphonedthrough questionable claims, all tied to depot licenses. The policy rewardedneither transparency nor innovation, it encouraged rent-seeking and corruption. Let’s also address a myth that continues to be repeated.Depots do not dr

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