Average Cost of Building A Petrol Station In Nigeria

We will analyze the cost of constructing a petrol station in Nigeria.

Petrol has been the most patronized natural gas product in Nigeria for decades. Most or all vehicles in Nigeria rely heavily on gasoline for their performance.

So, gasoline use has been a daily problem for most car owners, businesses, and households in Nigeria.

Thus, there is a need for more petrol filling stations in the country.

I assume you are vested in establishing a gas station in Nigeria. That’s why you’re here. If that is the case, you are at the correct address.

At the end of our discussion, you should understand the cost of opening a petrol filling station.

We’ll get right on it.

What will it Cost to Get a Gas Station Up and Running?

There are basic requirements you need to meet when building a gas station. These requirements include acquiring a site, registering your service station, and subsequent construction.

That is the sum-up of the construction of a service station in Nigeria.

From these requirements, we just mentioned that we can determine the actual cost of starting a service station in Nigeria.

Let’s go over these individually.

  • The Acquisition Cost for a Site

Deciding where to locate your service station will determine how much it will cost to acquire the land. Is it an urban or a rural area? Land acquisition in both types of colonies differs.

To get land for a gas station is very expensive in urban areas compared to rural colonies.

The location of your gas station should also be on the roadside to facilitate accessibility for consumers.

At this point, you must know that it will cost you more money. However, the average cost of acquiring land for a gas station in Nigeria varies from ₦4 million to ₦11 million.

You need to know that this price is not applicable in all parts of Nigeria, particularly in major cities.

In cities like Lagos, Abuja, Port-Harcourt, and other megacities in Nigeria, you know that purchasing land in these cities will surpass the amount we’ve merely mentioned.

The solid ground in such areas is around ₦100 million and above.

You can even get ₦2 billion Worth of land from those cities.

  • Registration Fee

You must register with the Independent Petroleum Market Association of Nigeria (IPMAN) when constructing a service station.

This organization runs the operations of every oil company in the country. This association will authorize you to operate a petrol station in Nigeria.

To register with IPMAN, you must pay nothing less than  ₦1.2 million.

  • Building Cost

There are specific processes involved in constructing a service station. First, you will need structural design, fuel dispensers, bay, and construction engineers.

As a result, each of those processes will cost you a certain amount of money.

  • Structural Design

It’s got to do with the architectural design of the entire gas station. Your design will describe the outcome of your project, i.e., what your service station will look like once it is completed.

Consequently, an architectural design for such a project will cost you nothing less than ₦800,000.

Some architects may charge you more than that amount. It’s a matter of how you negotiate with them.

  • Installation of Fuel Dispensers

It depends on how many fuel dispensers you install in your service station.

You will need a minimum of four fuel dispensers for a standard petrol station. You’ll need two more vending machines to sell other things like kerosene and diesel.

To put all these things together, it’s going to cost you about ₦30 million to ₦35 million.

But if you want more than those fuel dispensers for your petrol station, you can install more than four vending machines. A dual fuel dispenser in Nigeria runs from ₦1.5 million.

For a single fuel dispenser, that’s about 850,000 above.

  • Construction of a Bay

This is a critical feature in a petrol filling station. You can make part of your lube bay to serve as an office for your workers, including your manager, and part for storing other equipment.

You can use part of the building if you decide to sell other things like engine oil.

In fact, in Nigeria, some bays have become supermarkets and restaurants. But regardless of your choice, that’s fine; it’s just that having a lubricant bay at a gas station is very necessary.

Therefore, the cost of building a lubricant bay depends on your desired building. However, the average cost will be around ₦9 million or more.

You can spend more than this price for an elegant structure like a bay.

  • Site Engineers

Compensation for building engineers also varies.

While some engineers will collect a certain amount, others will be less or higher. So, it depends on how you talk to your site engineers.

However, the average cost of such a project for a site engineer is about ₦5 million.

  • Other Logistics

These logistics will include the cost of transportation, backup generators, and other additional expenses which will arise subsequently. All of these incremental expenditures will be approximately ₦5 million or more.

So, to ultimately start a gas station, you don’t need anything less than $55 million. It may cost you more, depending on where you set up your refueling station and how you want it to look.

You may also find a consultant in building gas stations in Nigeria and learn more about starting a gas station.

The price we have listed above is an approximate estimation of the construction of a gas station in the country at an average level.

Gas stations can cost between ₦200 billion and ₦3 billion in Nigeria, particularly in cities such as Lagos, Abuja, Port Harcourt, and so on.

Petrol Station is a very profitable enterprise in Nigeria.

If you put one in operation, you will make a lot of money. So, we hope you know the cost of constructing a gas station in Nigeria.

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