Nigeria’s downstream petroleum sector is heading for another major showdown as the Nigerian National Petroleum Company Limited (NNPC) and fuel marketers push back against efforts by Dangote Petroleum Refinery to halt the importation of refined petroleum products. In a suit before the Federal High Court in Lagos, NNPC argued that granting Dangote’s request to cancel fuel import licences could hand excessive market control to a single operator and expose the country to significant supply and pricing risks.
The dispute stems from Dangote Refinery’s challenge to import licences issued by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to marketers and NNPC. The refinery maintains that continued fuel importation undermines local refining capacity despite its claim that it can meet more than 90 per cent of Nigeria’s petrol demand. Dangote also accused government agencies and importers of frustrating its $20 billion investment through crude supply constraints and ongoing import approvals.
In response, NNPC told the court that Dangote’s petroleum products are sold at “significantly high and fluctuating market prices” driven by commercial considerations. The national oil company argued that the refinery had failed to provide independently verified evidence proving it can consistently satisfy Nigeria’s nationwide fuel demand. According to NNPC, fuel security extends beyond refining output and includes storage, transportation, distribution networks, logistics management, and strategic reserves needed to guarantee uninterrupted supply across the country.
NNPC further warned that relying heavily on a single refinery could expose Nigeria to fuel shortages, distribution failures, and market instability in the event of operational disruptions. The company insisted that fuel import licences remain lawful under the Petroleum Industry Act and are necessary to maintain competition, energy security, and market stability. It also rejected allegations that it deliberately denied crude oil supplies to the Dangote refinery, stating that supply arrangements are determined by commercial agreements, production realities, logistics, and security considerations.
Fuel marketers under the Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN) have thrown their weight behind NNPC’s position, arguing that a competitive market is essential for lower fuel prices and consumer protection. While acknowledging Dangote Refinery’s massive investment and contribution to domestic refining, industry stakeholders maintain that multiple supply channels remain necessary to prevent scarcity, improve pricing efficiency, and safeguard Nigeria’s energy future. As the legal battle unfolds, the outcome could reshape the balance of power in Nigeria’s deregulated petroleum sector and determine the future direction of fuel supply and pricing in Africa’s largest economy.
source: punch