Tuesday, 5 September 2017

Investment: How Can I Establish A Petrol Filling Station In Nigeria


Nigeria is known globally as one of the major oil producing country in the world especially with its huge crude oil deposits around the entire south south, south east and south west regions of the country. A large portion of these deposits of these still remain untapped though. Oil business in Nigeria is known for its huge capital requirement, so is other aspects of the business like exportation and exploration as well as marketing of the processed product. Aside from these mentioned areas, Nigeria still ranks high in the list of top petroleum users in Africa with a daily consumption running about 40 million liters. This is highly attributed to the large number of cars and private power generating sets run in homes as the power sector has continued to fail in supplying the power needed by all citizens.


Today in Building contractor secrets, i am going to give you a few insight on how you can invest in petroleum marketing as i would be giving you the basic things you'll need to know regarding the market. You will learn how much it costs to get these products from the refineries, advantages of being a dependent and independent marketer also the disadvantages of these marketers.

The truth is that almost every home in Nigeria have generators although now, people have started adopting other  renewable energy sources to power their home and businesses. To tell you how bad it is, i am making this post with my laptop connected to a UPS Which i charged last night with a generator.

This is same for schools, factories, hospitals and other businesses operated in Nigeria. There is never enough power supply for these businesses unless they device their own energy sources. Getting these products means users would need to go get to the petrol filling stations, pay for these products and use them to power their diesel or petrol generators in order to generate the power they need for their businesses.

Having read these, you can now see that a lot of profit would be made if you decided to venture into the petrol business especially when you have a petrol station of your own. Little wonder some marketers i know here in Warri, Delta state have invested so much that they now have more than 3 petrol stations after 3 years of business.

The most interesting part is that major oil marketers like Mobile, Total, Oando, Texaco have their eyes on the market as they are willing to individuals or marketers with the needed finance and logistics. They will sponsor such a person.

Now let us fee a few things about this business

What is the retail price of petrol in Nigeria?

Currently, the pump price of petrol in nigeria is between N140 to N145/Litre. This simply means that around the country, petrol is sold at a price not higher than N145 unless the petrol station is running an illegal business which could warrant a seal up by PPMC.

What is the Retail Price Of Diesel In Nigeria?

Well, The pump price of diesel in Nigeria is way above N200 and i am quite sure there is also demand that is almost the same as that of petrol. This means there'll be more profit for you if you venture into the business,

What Is the Retail Price of Kerosene In Nigeria?

According to a field survey, there is no established price for kerosene in the country. Reason could be that some marketers obtain products from Local refineries while others buy directly from the refineries. Now the thing is that those who buy from the refineries actually sell over N200/Litre while those who obtain theirs from Local refineries (Bunkerers) sell at a price lower than N200.

What Is The cost Of Petroleum Products in the Refineries?

In order to provide an answer to this question, i had to search and email the admin of www.downstreamview.com and also searched their page where i discovered that the price of products is as listed below

Refinery/Depot Price For Petrol = N132/Litre
Refinery/Depot price for Diesel = N165/Litre
Refinery/Depot Price For Kerosene = N160/Litre

How many litres of Fuel are consumed in Nigeria Daily?

The daily consumption of petrol by Nigerians amounts to over 40 million litres. This simply means that on a daily basis, Nigerians spend 145 x 40,000,000 = N5,800,000,000 (Five Billion, Eight Hundred Million Naira) on petrol only and this happens everyday.

Lets still continue...

What is the Loading Capacity Of Petrol Tankers In Nigeria?

A tanker load of petrol is designed to occupy a total of 30,000 litres of petrol. This is a huge amount of petrol and if you happen to buy at the Depot price mentioned above and sell at the current retail or pump price (N145/litre) you'll be making:

Cost Price For a Tanker Of Petrol = 132 x 30,000 = 3,960,000
Sales And Profit = 145 x 30,000 = 4,350,000

Now Subtract Cost Price From Sales Price To see the Profit

We have 4,350,000 - 3,960,000 = N390,000.

Now since it takes a total of 3 days to sell these 30,000 litres completely, it therefore means you'll sell more within the month or should i say 10 tankers in a month and that means 390,000 x 10 = 3,900,000.

I know You may want to ask me about cost of running the petrol station, sales girls ought to be paid too, But i would like to say here that even if you decide to pay your sales girls N50,000 monthly which i know no petrol station personnel earns, you'll still have a lot of profit since you are not selling petrol only.

Lets assume you employ 6 pump attendants, 4 for the petrol pumps, 1 for Kerosene Pump and another for Diesel Pump
Lets also assume you pay them N20,000 monthly

Now you will be spending just N120,000 for their salaries.

Now if you remove N120,000 from 3,900,000 You are still going to have over 3,800,000 As profit which is only coming from petrol. Now what about your profit from the sales of Kerosene, Diesel.
There really is a huge profit in Oil business my dear.

Where Can I Site My Petrol Filling Station?

I know you want to think about the urban or well developed areas like Portharcourt, Enugu, Warri, Abuja and other major cities in nigeria, but if you must know, these areas are majorly occupied by major marketers and has become their domains. Now think about this. What if you site the Petrol filling station in one of these rural areas with a lot of inhabitants. It may really not be a rural area though, but an area with alot of inhabitants. This would allow you exist feely wothout competition right?

Aside from existing with lesss to no competitor, You'll also enjoy a cheaper source of labor since the locals would be more than happy to work at any price you specify

Therefore, i could say there is a lot of profit to make when you invest in Petrol business by building your own petrol filling station.

I will write on Other areas too, so keep a date with Building Contractor secrets

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