In Fuel Import Licence Dispute, NNPC Accuses Dangote Refinery of Seeking Monopoly

*Warns court action could destabilise supply, undermine energy security

Wale Igbintade

The Nigerian National Petroleum Company Limited (NNPC) filed a defence in the Federal High Court in Lagos, alleging that the Dangote Petroleum Refinery is attempting to weaken competition in the downstream petroleum sector by legally challenging fuel import licences granted to rival marketers.

According to the state oil company, allowing the reliefs sought by Dangote would expose Nigeria to fuel supply disruptions, price instability, and threats to national energy security. NNPC maintained that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) acted within its statutory powers when issuing import licences. The company stated that the law permits licences for firms with local refining capacity or a proven record in petroleum trading, and that regulators retain discretion under Nigeria’s backward‑integration policy.

NNPC further argued that there is no legal requirement to ban imports except where a verified domestic shortfall exists. It rejected Dangote Refinery’s interpretation of the Petroleum Industry Act, insisting that fuel imports remain a lawful tool for stabilising supply and pricing in the domestic market.

The dispute originates from a suit filed by Dangote Petroleum Refinery challenging the issuance and renewal of import licences granted to petroleum marketers and the NNPC. The refinery seeks an interim injunction that would prevent the Attorney‑General of the Federation and relevant agencies from issuing or renewing licences for Premium Motor Spirit (PMS), Automotive Gas Oil (AGO), and Jet A1. Dangote argues that continued issuance of import licences undermines local refining and violates Section 317(9) of the Petroleum Industry Act, which it interprets as limiting imports to situations where a proven supply shortfall exists.

The refinery, with a capacity of about 650,000 barrels per day, maintains that Nigeria already produces enough refined product to meet national demand. It cites regulatory data showing that daily production of petrol and diesel exceeds consumption levels, arguing that imports are therefore unnecessary.

Dangote Refinery also told the court that it can meet 100 % of Nigeria’s refined petroleum needs while generating an export surplus. It described the project as a major national investment expected to create a multi‑billion‑dollar market for Nigerian crude oil.

NNPC disputed the refinery’s claims, stating that Dangote has not provided credible or verifiable evidence to support its production capacity assertions.

The NMDPRA has applied to join the case, broadening the dispute into a wider regulatory and policy conflict over fuel importation and market structure.

Dangote Refinery further alleged that government agencies, including the NMDPRA, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), and NNPC, have created a hostile operating environment by continuing to issue import licences despite the absence of a supply shortfall. It also accused NNPC of failing to supply sufficient crude oil for optimal operations, claiming it receives about five crude cargoes per month instead of the 13 required to run at full capacity, forcing it to source crude internationally at higher prices.

NNPC denied any wrongdoing, insisting that crude allocation decisions are based on operational, commercial, security, and logistical considerations rather than an attempt to sabotage the refinery.

The dispute has gained additional importance ahead of Dangote Refinery’s planned September IPO, raising concerns among investors about regulatory stability and market predictability in Nigeria’s downstream oil sector.

NNPC warned that restricting import licences could destabilise fuel supply, increase price volatility, and threaten energy security in Africa’s largest oil market.

Dangote Refinery counters that continued imports could undermine its operations and jeopardise Nigeria’s long‑term goal of energy self‑sufficiency. It is also seeking an interim injunction to halt the issuance of new import licences pending the outcome of the substantive suit, arguing that it would suffer irreparable financial and operational losses.

The court has not yet scheduled a hearing date for the case.