NNPCL challenges Dangote Refinery’s bid for sole import rights of petroleum in court

The Nigerian National Petroleum Company Limited (NNPCL) has filed a preliminary objection against a lawsuit initiated by Dangote Petroleum Refinery and Petrochemicals FZE, which seeks exclusive rights to import petroleum products into the country.

Represented by a team of lawyers led by Mr. Kehinde Ogunwumiju, SAN, NNPCL argued that the lawsuit, which aims to revoke its import license, is legally deficient. The company described the suit as “incompetent” and questioned the jurisdiction of the court to entertain it.

In the case, marked FHC/ABJ/CS/1324/2024, Dangote Refinery listed the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), NNPCL, and several prominent oil marketers, including AYM Shafa Limited, A. A. Rano Limited, and Matrix Petroleum Services Limited, as defendants.

The refinery argued that the NMDPRA violated Sections 317(8) and (9) of the Petroleum Industry Act (PIA) by issuing import licenses to the defendants despite Dangote Refinery’s capacity to meet the nation’s demand for petroleum products, particularly Automotive Gas Oil (AGO) and Jet-A1 fuel.

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“Despite the production of AGO and Jet-A1 that exceeds the current daily consumption of petroleum products in Nigeria by the Dangote Refinery, the defendants were still issued import licenses,” the refinery stated in court filings.

As part of its reliefs, Dangote Refinery is seeking N100 billion in damages against the NMDPRA for continuing to issue import licenses. It also requested the court to restrain the regulator from renewing or issuing licenses to the defendants, seal storage facilities used for imported petroleum products, and revoke all previously granted licenses.

In its response, NNPCL maintained that the lawsuit was premature and lacked merit. “The plaintiff’s suit is premature. The plaintiff’s suit discloses no cause of action. The 2nd defendant is not a competent party. The plaintiff’s suit is incompetent. This honourable court lacks the jurisdiction to hear this suit,” NNPCL argued.

NNPCL also highlighted a procedural error, noting that Dangote Refinery had sued a non-existent entity. “A simple search on the CAC website shows that there is no entity called Nigeria National Petroleum Corporation Limited, NNPC,” it said, emphasizing that NNPCL and the listed defendant are distinct entities.

The other defendants, including major oil marketers, also urged the court to dismiss the suit. They accused Dangote Refinery of attempting to monopolize Nigeria’s petroleum sector, which they argued would have dire consequences.

“Allowing the plaintiff to take over the oil sector would spell doom for the country,” they contended. The marketers insisted that they are qualified to import petroleum products under Section 317(9) of the PIA.

They further warned that granting Dangote Refinery exclusive control over imports would stifle competitive pricing, worsen Nigeria’s economic challenges, and inflict hardship on citizens. “Vesting the plaintiff with monopoly power in Nigeria’s petroleum industry would kill competitive pricing and deteriorate the nation’s critically ailing economy,” the defendants argued.

Presiding over the case, Justice Inyang Ekwo adjourned the matter until January 20, 2025, to allow the parties to explore an out-of-court resolution. Dangote Refinery has indicated its willingness to withdraw the lawsuit if an amicable settlement is reached.

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