HomeEconomy#Dangote Refinery and FCCPC Face Off in Court Over Alleged Petrol Monopoly

#Dangote Refinery and FCCPC Face Off in Court Over Alleged Petrol Monopoly

The Dangote Petroleum Refinery and Petrochemicals FZE and the Federal Competition and Consumer Protection Commission (FCCPC) are locked in a legal battle over allegations of monopoly and a N100 billion import license lawsuit.

The case, filed at the Federal High Court, Abuja (FHC/ABJ/CS/1324/2024), challenges the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) for issuing petroleum import licenses to companies including NNPCL, Matrix Petroleum, and A.A. Rano. Dangote Refinery argues that these products are already available domestically, and issuing import licenses violates the Petroleum Industry Act (PIA), which permits imports only when there is a proven shortfall.

Key Legal Arguments

  • Dangote Refinery’s Position:
    • The refinery contends that NMDPRA is violating Sections 317(8) and (9) of the PIA by granting import licenses despite sufficient local production.
    • It seeks N100 billion in damages and a court order to revoke the licenses.
  • NNPCL’s Objection:
    • NNPCL’s legal team argues that the case is flawed due to the misnaming of NNPCL as “Nigeria National Petroleum Corporation” instead of its legal name.
    • It insists that NMDPRA, not Dangote Refinery, determines supply shortfalls and that import licenses remain necessary.

  • FCCPC’s Intervention:
    • The FCCPC filed a motion to join the case, arguing that blocking imports could lead to a monopoly in favor of Dangote Refinery.
    • The commission insists that Nigeria operates a free-market economy and that restricting import licenses contradicts competition laws.
    • It aims to prevent anti-competitive practices and ensure fair market access for all industry players.

Dangote Refinery’s Counter to FCCPC

  • Dangote Refinery argues that FCCPC has no jurisdiction over petroleum licensing under the Petroleum Industry Act and describes the commission as a “meddlesome interloper.”
  • It maintains that its case is not about monopoly but about enforcing local refining regulations.
  • It insists that FCCPC should seek legal amendments rather than interfere in a petroleum-sector case.

What’s Next?

  • The court is set to rule on FCCPC’s application to join the case, with the next hearing scheduled for February 5, 2025.
  • The outcome could have significant implications for Nigeria’s petroleum industry, impacting competition, local refining, and fuel import regulations.

This legal dispute unfolds against the backdrop of Aliko Dangote’s recent willingness to sell a stake in his refinery to NNPCL, following disagreements with regulators and stakeholders over fuel pricing and market access.

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