Three prominent oil marketers—AYM Shafa Limited, A. A. Rano Limited, and Matrix Petroleum Services Limited—have taken legal action against Dangote Petroleum Refinery and Petrochemicals, urging the Federal High Court in Abuja to reject a suit aimed at limiting the importation of petroleum products into Nigeria.
In a joint counter-affidavit filed on November 5, 2024, the marketers expressed concern that granting Dangote Refinery a monopoly over Nigeria’s oil sector would lead to devastating consequences for the nation’s energy and economic stability.
The marketers assert that the refinery’s bid to restrict import licenses is harmful to the competitive landscape of the oil industry and would drive up fuel prices across the country.
The controversy began when Dangote Refinery, in its September 6, 2024, lawsuit, sought a court order to declare that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) violated the Petroleum Industry Act (PIA) by issuing import licenses to other marketers.
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Dangote argued that such licenses should only be issued in cases of petroleum product shortages, emphasizing that the NMDPRA’s actions undermine local refineries, like its own, and distort the market.
However, the marketers countered, arguing that Dangote’s refinery does not yet produce enough petroleum products to meet Nigeria’s daily consumption needs.
They pointed out that the refinery had not provided any evidence to support its claim that it could supply sufficient volumes to meet demand. Moreover, they maintained that they had fully complied with legal requirements to obtain the import licenses granted by the NMDPRA.
“The import licenses lawfully issued to the defendants by NMDPRA do not in any way cripple the plaintiff’s business or its refinery,” the marketers said in their affidavit.
They warned that Dangote’s efforts to monopolize Nigeria’s petroleum market would stifle competition, exacerbate fuel prices, and harm the nation’s struggling economy.
The marketers further highlighted the potential risks of putting all Nigeria’s oil supply in the hands of a single entity. They stressed that should Dangote’s refinery face operational disruptions, the country could be plunged into an energy crisis.
“If Nigeria puts all her energy eggs in one basket and stops the importation of petroleum products, we risk leaving the country at the mercy of one company, which can dictate both the availability and pricing of petroleum products,” the marketers warned.
They also cautioned that the refinery’s current production capacity could not support Nigeria’s daily fuel needs.
“In the event of any breakdown in or obstruction to the production chain of Dangote Refinery, Nigeria will be thrown into an energy crisis,” they argued, noting that the country lacks sufficient reserves to sustain itself without imports.
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The presiding judge, Justice Inyang Ekwo, adjourned the case to January 20, 2025, for further proceedings and to allow for settlement discussions.
Meanwhile, Dangote Refinery has begun exporting petroleum products, with reports showing that three foreign firms—Vitol Group, Trafigura Group, and BP Plc—are the dominant buyers of the refinery’s output.
Since its operations began earlier this year, Dangote’s refinery has processed an average of 420,000 barrels of crude oil per day and is expected to increase its output to 650,000 barrels per day once fully operational.
