Ɗangote in court, seeks revocation of NNPCL, others’ import licenses 

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As NMDPRA defends decision

The Nigeria Midstream and Downstream Petroleum Regulatory Authority, (NMDPRA), has defended its decision to issue petroleum import licenses to various oil marketers, citing the need to bridge shortfalls in national supply. 

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This defense was presented before Justice Inyang Ekwo, of the Federal High Court, Abuja, in response to a suit filed by Ɗangote Petroleum Refinery and Petrochemicals FZE.

In a counter-affidavit submitted by a Senior Regulatory Officer at NMDPRA, Idris Musa, the Authority argued that the Ɗangote Refinery’s current production levels are insufficient to meet Nigeria’s daily petroleum product demands. Consequently, licenses were issued to reputable companies to import refined products in compliance with Section 317(9) of the Petroleum Industry Act, (PIA).

Ɗangote Refinery filed the suit on Sept. 6, 2024 (Case No. FHC/ABJ/CS/1324/2024), naming NMDPRA, the Nigerian National Petroleum Corporation Ltd. (NNPCL), and 5 oil marketers – AYM Shafa Ltd, A.A. Rano Ltd., T. Time Petroleum Ltd., 2015 Petroleum Ltd., and Matrix Petroleum Services Ltd.- as defendants.

Through its counsel, Ogwu Onoja (SAN), Ɗangote Refinery asked the court to: ‘Nullify the import licenses issued to NNPCL and the five companies’; ‘Declare that NMDPRA violated Sections 317(8) and (9) of the PIA by issuing these licenses’, and ‘Award ₦100 billion in damages for alleged wrongful issuance of the licenses.

In its response, NMDPRA urged the court to dismiss the suit as baseless and lacking merit. Musa argued that the authority is mandated to ensure national energy security by preventing monopolies and supporting multiple sources of supply.

Musa also highlighted on-going efforts to boost local refining, including operationaliding modular refineries and rehabilitating NNPCL-owned refineries. He stated that while Ɗangote Refinery and other local operators are contributing to supply, they cannot yet meet the country’s full demand for refined petroleum products.

The regulatory authority warned that granting Ɗangote exclusive control of the market would create a monopoly, jeopardising energy security and fair pricing. It emphasised the importance of maintaining a competitive market structure with multiple players, in order to ensure stability and adequate supply.

NMDPRA further justified its demand for a 0.5% levy from wholesale customers as stipulated by the PIA. Musa rejected claims that Ɗangote’s free zone operations exempt it from paying such levies, asserting that all entities operating in Nigeria are subject to local laws.

The NNPCL and the oil marketers also opposed the suit. In a joint counter-affidavit, the marketers—AYM Shafa Limited, A.A. Rano Ltd, and Matrix Petroleum Services Ltd —argued that Ɗangote’s application to monopolize the market would harm the oil sector and exacerbate supply challenges.

The defendants noted that Ɗangote Refinery has yet to produce enough petroleum products to meet Nigeria’s daily needs and dismissed claims of a “grand conspiracy” against the refinery as unsubstantiated.

Justice Ekwo had scheduled a hearing for today, Monday, to receive a report on settlement or progress on service in the case.

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