The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) and Azikel Refinery have begun discussions on a proposed direct offtake partnership aimed at improving access to locally refined petroleum products and strengthening supply across Nigeria.
The development followed a high-level visit by PETROAN's national executive leadership to the Azikel Refinery in Obunagha, Yenagoa, Bayelsa State, where the delegation assessed the progress of the 25,000 barrels-per-day (bpd) facility and explored possible areas of commercial cooperation.
Led by PETROAN National President, Dr. Billy Sotubo Gillis-Harry, the delegation held discussions with the management of Azikel Group on arrangements that could enable petroleum products retailers to source products directly from the refinery once commercial operations commence.
The proposed arrangement is expected to cover key refined products, including Premium Motor Spirit (PMS), automotive gas oil (AGO), kerosene, aviation turbine fuel (ATF) and liquefied petroleum gas (LPG).
PETROAN said the engagement formed part of its broader efforts to strengthen relationships across Nigeria's downstream petroleum sector and support the development of sustainable domestic supply chains.
According to the association, the visit had three principal objectives: to evaluate the progress of emerging domestic refining projects, establish discussions with an indigenous refiner on practical commercial cooperation, and explore arrangements capable of improving the availability and reliability of petroleum products for retailers and consumers.
During the visit, Azikel management briefed the PETROAN delegation on the refinery's development, engineering progress, planned operations, product configuration and potential areas of collaboration with petroleum products retailers.
A major focus of the meeting was the proposed offtake arrangement, which would provide PETROAN members with a direct channel for purchasing products from the refinery under mutually agreed commercial, technical and operational conditions.
PETROAN said direct engagement between domestic refiners and organised petroleum retailers could help reduce the number of intermediaries within the downstream supply chain, potentially improving efficiency and reducing some of the uncertainty and additional costs associated with product distribution.
The association also noted that an organised retail market could provide domestic refiners with a more predictable customer base for their output, while retailers could benefit from greater visibility over product availability and supply planning.
Azikel Refinery has undergone a major expansion and re-engineering programme, with its original 12,000 bpd design capacity increased to 25,000 bpd. The facility is configured as a full-slate hydro-skimming refinery capable of processing crude oil and condensate into several petroleum products.
The refinery's product slate includes petrol, diesel, kerosene, aviation turbine fuel and LPG.
The project reached another significant milestone with the reported arrival and installation of its 200-tonne crude distillation unit (CDU), a critical component of the refining process. The facility, estimated to have a project value of about $1 billion, is being developed by Azikel Group under the leadership of its President and Chief Executive Officer, Dr. Eruani Azibapu Godbless.
Speaking during the engagement, Gillis-Harry said PETROAN was interested in establishing practical and commercially sustainable relationships with indigenous refiners.
He said the association's objective was to create partnerships capable of improving product availability, strengthening distribution networks and providing greater certainty for businesses and consumers.
Gillis-Harry added that PETROAN's interest extended beyond securing supplies for its members, stressing the importance of developing long-term commercial relationships that would provide value for both refiners and petroleum marketers.
Responding, Dr. Eruani Azibapu Godbless welcomed the PETROAN delegation and expressed the refinery's willingness to develop strategic relationships with petroleum retailers as the project moves toward commercial operations.
Godbless emphasized the importance of cooperation between refiners and retail outlet owners in ensuring efficient distribution and establishing reliable market access for locally refined petroleum products.
Both sides agreed that further engagement would be required to address the commercial, technical and operational issues that would underpin any eventual offtake agreement.
PETROAN said its discussions with Azikel form part of a wider strategy to deepen engagement with indigenous refiners and other stakeholders across Nigeria's downstream petroleum value chain.
The association has also advocated greater diversity in domestic sources of petroleum products, arguing that a broader supplier base can promote competition and strengthen supply security.
According to PETROAN, the emergence of projects such as the Azikel Refinery, alongside other domestic refining developments, represents an expansion of Nigeria's refining base and could contribute to a more competitive and resilient petroleum products market.
The association said it would continue to engage credible domestic refining projects and other industry stakeholders in an effort to support increased local refining, improved product distribution and a more sustainable downstream petroleum sector.
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