Billionaire businessman, Femi Otedola has explained how he warned former President Goodluck Jonathan against continuing with subsidy payments citing lack of transparency and and corruption.
According to him, during the Jonathan administration over N2 trillion was siphoned through questionable petrol subsidy claims linked to depot licences.
Otedola spoke in a statement on Monday, backing the Dangote Petroleum Refinery (DPR) in its with the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN).
On September 16, DAPPMAN accused the refinery of engaging in market-disruptive practices, claiming that the company’s fuel price cuts were strategically timed to weaken competition rather than to serve patriotic interests.
Countering the group, the Dangote refinery said DAPPMAN allegedly demanded an annual subsidy of N1.5 trillion to enable members match the refinery’s gantry prices at their own depots.
Speaking on the issue, Otedola said the petrol subsidy system was structured to favor depot owners, with DAPPMAN members emerging as the main beneficiaries.
“On subsidy, I personally warned President Goodluck Jonathan that he was being misled. The system was built to benefit depot owners, and DAPPMAN members became the primary beneficiaries,” he said.
“Over N2 trillion was siphoned through questionable claims, all tied to depot licenses. The policy rewarded neither transparency nor innovation, it encouraged rent-seeking and corruption.”
Addressing what he described as a “a myth that continues to be repeated”, Otedola said depots do not drive employment as some people claim.
“A typical depot employs perhaps five people, gatekeeper included. In contrast, a single filling station can provide jobs to dozens of Nigerians—from pump attendants to cashiers, security personnel, and cleaners,” Otedola said.
“If anything, DAPPMAN members should be focusing on owning and scaling last-mile retail outlets, not holding on to tanks built for a fuel import economy that no longer serves us.
“The global picture is instructive. Depots in Amsterdam or Houston were designed to serve export markets, especially Africa. With Nigeria now refining locally, such infrastructure is increasingly unnecessary. The same thing happened in the cement industry.”
He said immediately Nigeria started producing cement locally, “the bulk carriers that used to dock at our ports were retired, many sold as scrap”.
“The same outcome awaits fuel depots,” Otedola said.
The billionaire warned that if DAPPMAN members do not adapt, they will become irrelevant, and possibly go bankrupt.
“Instead of resisting progress, they should consider selling, restructuring, or investing in new value chains,” he added.
He said if they genuinely believed in competition, they could pool resources to acquire the Port Harcourt refinery and attempt to succeed where the Nigerian National Petroleum Company (NNPC) Limited had failed.