PETROAN targets direct refinery supply to cut import dependence

By Onu Okorie

Petroleum Products Retail Outlets Owners Association of Nigeria PETROAN is moving to reshape Nigeria’s downstream petroleum market by developing direct supply arrangements with indigenous refineries, a strategy aimed at reducing retailers’ exposure to imported fuel and improving the reliability of domestic supplies.
The initiative took a concrete step on September 29, 2026, when PETROAN National President, Dr. Billy Sotubo Gillis-Harry, led the association’s national executives to Azikel Refinery in Obunagha, Yenagoa, Bayelsa State, for an inspection and commercial engagement.
Rather than focusing solely on refinery capacity, the engagement centred on creating a direct commercial link between refiners and the retail network, with PETROAN proposing a structured offtake arrangement under which its members would purchase petroleum products directly from Azikel on mutually agreed commercial, technical and operational terms.
Gillis-Harry said the proposed arrangement was part of PETROAN’s broader effort to develop sustainable partnerships with indigenous refiners and create greater certainty in the downstream supply chain.
“As retailers, we want to build practical partnerships with indigenous refineries that can improve product availability, strengthen supply chains and create greater certainty for businesses and consumers,” he said.
The PETROAN initiative comes against the backdrop of the vulnerabilities associated with Nigeria’s historical dependence on imported petroleum products, including exposure to international crude and refined-product prices, foreign exchange pressures and disruptions in global supply chains.
According to Gillis-Harry, stronger direct relationships between domestic refiners and organised retailers could reduce some of these vulnerabilities by bringing producers and the retail market closer together.
Under the proposed model, aggregated demand from PETROAN members could provide refiners with a more predictable market for their output, while retailers would have an additional source of locally refined products outside conventional supply channels.
Azikel raises refining capacity
PETROAN said Azikel Refinery has been re-engineered from its original 12,000 barrels-per-day design to a 25,000 barrels-per-day full-slate hydro-skimming facility following the arrival and installation of its 200-tonne Crude Distillation Unit.
The refinery is configured to process crude oil and condensate into Premium Motor Spirit (PMS), automotive gas oil (AGO), kerosene, aviation turbine fuel (ATF) and liquefied petroleum gas (LPG).
The association said the project has entered an advanced stage of construction and integration ahead of commercial operations.
Receiving the PETROAN delegation, President and Chief Executive Officer of Azikel Group, Dr. Eruani Azibapu Godbless, welcomed the proposed partnership and expressed the refinery’s readiness to establish strategic relationships with petroleum products retailers.
The two sides agreed to sustain discussions on the commercial, technical and operational requirements that would have to be resolved before a formal offtake arrangement can be concluded.
Diversification, not another supply concentration
For PETROAN, however, the Azikel discussions are not intended to create another single-source supply structure in the downstream market.
The association said the engagement represents one part of a wider strategy to establish relationships with multiple indigenous refineries and diversify the sources available to petroleum retailers.
PETROAN argued that concentrating supply in one refinery could create its own vulnerabilities, making multiple reliable sources, transparent market participation and competition important elements of a resilient downstream market.
The emerging strategy therefore places retailers in a potentially important position in the transition from an import-dependent market to one increasingly supplied by domestic refineries.
If replicated across other indigenous refineries, direct offtake agreements could create a broader network linking domestic refining capacity with filling stations and other petroleum-product retailers.
PETROAN said it would continue to support credible investments capable of expanding domestic refining capacity and improving competition, while stressing that sustained cooperation among refiners, marketers, regulators and other downstream stakeholders would be necessary to translate new refining capacity into reliable supplies for consumers.