Otedola Urges Petroleum Marketers to Embrace Innovation, Says Depot Model Obsolete

Billionaire businessman Femi Otedola has advised the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) to adapt to sweeping reforms in the downstream oil sector, warning that resisting change could lead to bankruptcy and irrelevance.

In a statement on the ongoing dispute between DAPPMAN and the Dangote Refinery, Otedola congratulated Alhaji Aliko Dangote on what he described as a “historic leap” toward Nigeria’s energy independence. He said the refinery had fundamentally altered the structure of fuel supply in the country, rendering the traditional import-driven depot system outdated.

“Times have changed. Many of the original players have exited, and those left are clinging to assets that no longer reflect today’s business realities. I advised some of them as far back as last year to sell their depots as scrap while they still had value,” he said.

Otedola, who founded DAPPMAN in 2002, noted that the association’s initial role of bridging fuel supply gaps no longer exists, as domestic refining has eliminated the inefficiencies that previously justified large depot infrastructure. He highlighted Dangote Refinery’s investment in 8,000 CNG-powered trucks as an example of how modern logistics were replacing outdated systems.

Criticising the association’s demand for financial concessions from Dangote, Otedola argued there was no basis for such claims in a deregulated market. He said insisting on subsidies and protection for depots amounted to preserving a system “built on imports, subsidies, and outdated infrastructure.”

He also dismissed claims that depots generate significant employment, explaining that they typically operate with minimal staff compared to filling stations that employ larger numbers. Instead, he urged marketers to channel investments into retail outlets or explore new value chains such as refinery participation.

Drawing parallels with Nigeria’s cement industry, Otedola warned that depots risk going the way of bulk cement carriers, which disappeared after the country achieved self-sufficiency in cement production. He cited the Folawiyo Group’s exit from the depot business as an example of foresight in adapting to change.

“DAPPMAN had its place, but today its relevance is fading. Aliko’s refinery is not the problem—it is the solution. We must stop clinging to outdated privileges and move into a new era of transparency and sustainable value creation,” he said.

The Zenon Oil founder also commended President Bola Ahmed Tinubu for pushing through full deregulation of the downstream sector, saying the reforms had dismantled entrenched cabals and laid the foundation for competition and efficiency.

Otedola recalled warning former President Goodluck Jonathan about subsidy fraud, alleging that over N2 trillion was lost through questionable depot-linked claims. He maintained that the subsidy regime encouraged rent-seeking and corruption rather than innovation.

Ending on a personal note, Otedola saluted Dangote’s role in transforming Nigeria’s energy landscape. “Africans are proud of you. And yes, my dear brother Aliko, you can now go to Monaco and rest jejely like me—you’ve earned it,” he said.