The marketers—AYM Shafa Limited, A.A. Rano Limited, and Matrix Petroleum Services Limited—warned that Dangote’s push for exclusive control over petroleum supply could lead to economic instability and rising energy costs.
Dangote Petroleum Refinery, owned by billionaire Aliko Dangote, had filed a suit (FHC/CS/ABJ/1324/2024) in September, accusing the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) of violating the Petroleum Industry Act (PIA) by issuing import licenses to various companies, including the three marketers opposing the suit.
Dangote argued that the issuance of such licenses contradicted sections 317(8) and (9) of the PIA, which supposedly restricts these licenses to cases where there is a shortfall in local production.
The refinery sought to halt all licenses for oil importation, asserting that NMDPRA’s actions hindered its operations and local production efforts.
In response, the marketers maintained that their licenses were legally issued and aligned with the Petroleum Industry Act and other regulatory frameworks. They emphasised that the licenses enable a competitive market, ensuring stability in petroleum prices.
One of the representatives stated, “Vesting Dangote with monopoly power in Nigeria’s petroleum sector will kill competitive pricing, deteriorate Nigeria’s critically ailing economy, and unleash untold hardship on Nigerians.”
The marketers expressed serious concerns about granting Dangote a monopoly, suggesting it would put Nigeria’s energy security at risk. They explained that if Dangote’s refinery faced disruptions, the country would be without sufficient reserves, and reordering from foreign suppliers could take over 30 days.
In their affidavit, they argued, “If Nigeria puts all her energy eggs in one basket by stopping importation of petroleum products and allowing the plaintiff [Dangote] to be the sole producer, the prices of petroleum products in Nigeria will continue to rise, and energy security will elude Nigeria.”
Further, they raised doubts about Dangote’s capacity to meet Nigeria’s petroleum demands alone, pointing out that there was no evidence the refinery could supply adequate volumes for the country’s daily consumption.
Granting Dangote exclusive control dangerous – Marketers
The marketers cautioned that granting Dangote exclusive control would be economically dangerous, potentially leaving Nigerians at the mercy of a single supplier in terms of product availability and pricing.
In their counter-affidavit, the marketers also noted that their licenses were issued legally by NMDPRA and did not hinder Dangote’s business.
They argued, “The import licences lawfully issued to the defendants did not in any way cripple the plaintiff’s business or its refinery. The licenses conform to the PIA, the Federal Competition and Consumer Protection Act, and other relevant laws.”
The marketers requested that the court dismiss Dangote’s claims, insisting that competitive practices are essential to Nigeria’s economic health and the oil sector’s viability.
They urged the court to reject any move that could create a monopoly in Nigeria’s oil industry, stating that doing so would create “a recipe for disaster.”
As this court battle unfolds, it highlights a significant debate over the balance between supporting local production and ensuring fair competition, with potential consequences for Nigeria’s energy sector and economy at large.
The court’s ruling will likely have far-reaching implications for the oil industry, consumer prices, and the regulatory landscape in Nigeria.
