Dangote Petroleum Refinery and Petrochemicals has filed a lawsuit against the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and several major oil importers in the Federal High Court in Abuja, seeking damages of N100 billion.
In the suit, identified as FHC/ABJ/CS/1324/2024, Dangote argues that the continued issuance of import licenses for refined products, including Automotive Gas Oil and Jet-A1 (aviation fuel), is unwarranted since the refinery’s output exceeds domestic demand.
However, oil marketers have countered this position, asserting that the market is deregulated, allowing dealers to import fuels or purchase them from the $20 billion Lekki-based refinery.
Dangote is also requesting the revocation of import licenses issued to Nigerian National Petroleum Corporation Limited (NNPCL), Matrix Petroleum Services Limited, A. A. Rano Limited, and four other companies. The defendants include NMDPRA, NNPCL, AYM Shafa Limited, and others.
According to Dangote, these imports have disrupted its operations by saturating the market with products it can supply without shortfalls. The company alleges that NMDPRA has violated the Petroleum Industry Act by granting licenses despite the absence of any product shortfall and has neglected its duty to support local refining.
An affidavit from Ahmed Hashem, General Manager for Government and Strategic Relations at Dangote, states that the importation of AGO and Jet-A1 has severely affected the refinery’s business, leading to unsold products and threatening its investments.
Dangote also claims NMDPRA intends to impose a 0.5 percent levy on wholesale buyers and an additional 0.5 percent for the Midstream and Downstream Gas Infrastructure Fund, arguing this contradicts the regulatory framework governing free zones, which aim to enhance competition and attract investment.
The lawsuit accuses international oil companies and other defendants of collaborating to undermine Nigeria’s domestic refining efforts, alleging they have funded media campaigns to spread false information about Dangote’s operations.
Additionally, Dangote seeks a court declaration affirming its exemption from all federal, state, and local taxes, in accordance with relevant Nigerian laws.
Key reliefs sought include declarations that NMDPRA violated the Petroleum Industry Act by issuing import licenses without just cause and that Dangote, as a Free-Zone Enterprise, is exempt from various taxes and levies.
The refinery is also requesting an order to prevent NMDPRA from issuing further import licenses to the named companies and to seal their storage facilities.
At a recent court hearing, Dangote’s counsel, George Ibrahim SAN, informed Justice Inyang Ekwo that the parties are in discussions for a possible settlement. The judge has scheduled a follow-up for January 20, 2025, to review the settlement progress or service of the summons.
Written By: Praise Inalegwu