EVALUATION OF THE DISTRIBUTION STRATEGIES ADOPTED BY OANDO PLC FOR THE MARKETING OF PETROLEUM
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EVALUATION OF THE DISTRIBUTION STRATEGIES ADOPTED BY OANDO PLC FOR THE MARKETING OF PETROLEUM
Chapter one
INTRODUCTION
This chapter contains information on the issue being researched. The study’s background, issue statement, aims, and importance, as well as the research question, will be revealed here so that the researcher understands what the research is about.
1.1 Background of the Study
As a result, among other things, petroleum products are our country’s main export. Our country relies completely on it for the biggest percentage earnings from total exportation products or items.
Following the civil war in the 1979s, Nigerians relied heavily on agricultural products for home and international purposes. However, due to the increased profitability of this product over the world, the former was abandoned in favour of the latter.
Because the uses are universal, the extractive regions in the south east and south west have had a tough time supplying or distributing to other parts of the country, owing to mismanagement and other opposing causes.
The transportation of these extraction products from the origin area to the refinery was a major issue in the country due to their bulky nature and distribution channel. The government then hired international companies to refine this product in order to reach the hook and the country.
The government-built and managed refinery allowed a foreign corporation to participate in the refinery for the purpose of providing importation services. Still insufficient, as the dealer diverts this merchandise to their own target locations, where they hope to sell of it at a high price.
At times, petroleum products such as fuel, kerosene, diesel, and bitumen, to name a few, shift completely from the generic colour used to it to an unexpected colour, causing harm to the human body. These dealers, who had previously worked for one firm and another for years, quit their respective offices to promote these products,
forming one organisation and another to impose prices on these things. The place where the majority of people are not interested in using this product due to beliefs or customs has a lower cost and more optimal amounts than other regions.
Based on the statistics, it is apparent that if the left cream of the nation is to be viable, a significant percentage or rate of the standard of living would have made the public happy.
OANDO PROFILE
Oando’s beginnings can be traced back to the establishment of ESSO Africa in 1956. ESSO Africa was a petroleum marketing company and a subsidiary of Exxon Corporation in the United States of America.
In 1976, the Nigerian government purchased a controlling position in the company and renamed it Unipetrol Nigeria. Unipetrol became a Public Limited Company on March 1, 1991,
and later that year, the Nigerian government sold 60% of its equity to the Nigerian public through an initial public sale. By February 1992, Unipetrol had been listed on the Nigerian Stock Exchange.
In 1999, Unipetrol bought a 40% share in Gaslink Nigeria Limited, a gas utility firm. The acquisition was prompted by a desire to capitalise on its exclusive gas sale and purchase arrangement with the Nigerian gas business.
In 2001, the business raised its shareholding to 51%.Ocean and Oil, a private investment business founded by Nigerian entrepreneurs Adewale Tinulu and Omamofe Boyo,
bought a 30% controlling stake in Unipetrol Plc in 2000. Ocean and Oil grew its stake in Unipetrol to 42% in 2001 by issuing irredeemable convertible credit stock.
In 2002, Ocean and Oil led Unipetrol’s quest for a 60% share in Agip Nigeria Plc, a rival petroleum marketing firm owned by Agip petroli BV, an Italian oil company. In 2003, the amalgamated firm was renamed Oando Plc, which became Nigeria’s largest downstream petroleum marketing company.
In 2005, Oando Energy Services was established as an integrated oilfield services firm to accomplish the group’s goals in the upstream services market. In 2007, Oando Energy Services purchased two oil drilling rigs in Nigeria’s Niger Delta.
In 2008, the business became Nigeria’s first indigenous oil company with a focus on producing deep sea assets after acquiring shares in two oil blocs.
By 2009, the company had bought five swamp rigs, and in 2010, it began operating its first independent power plant for the Lagos Water Corporation. The project called for the construction of a 12.5-megawatt power plant to provide the Lagos Water Corporation with uninterrupted power supply.
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