Only NMDPRA and NNPCL can determine petroleum shortfall in Nigeria, oil companies tell Court 

Three oil companies—Matrix Petroleum Services Limited, A.A. Rano Limited, and AYM Shafa Limited—have asked the Federal High Court in Abuja to hold that only the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Nigerian National Petroleum Corporation Limited (NNPCL) can determine if there is petroleum shortfall in Nigeria, not Dangote Refinery.

This is contained in their written address seen by Nairametrics, attached to their counter affidavit dated November 5, 2024, seeking the prohibition of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) from reviewing or withdrawing their import licenses.

On the provision of Section 317(9) of the Petroleum Industry Act(PIA), the oil companies’ lead counsel, Ahmed Raji SAN submitted that the only person and appropriate authority vested with statutory powers and the prerogative to determine when and if there is petroleum products shortfall in Nigeria is the NMDPRA (1st Defendant) in conjunction with the NNPCL (2nd Defendant.)

Address Against Dangote Refinery’s Lawsuit 

• In the much-discussed suit filed by Dangote Petroleum Refinery and Petrochemicals FZE, it seeks an order voiding the import licenses issued to the Nigerian National Petroleum Corporation Limited (NNPCL) and five other companies for importing refined petroleum products that Dangote already produces domestically, without any shortages.
• In their counter, the three companies’ lawyer, Ahmed Raji SAN, urged Justice Inyang Ekwo to dismiss the suit, emphasizing that countries worldwide ensure energy security.
• In further reaction to Dangote Refinery’s suit, Raji, through his written address, maintained that the Plaintiff lacks the powers at all times to determine when or if there is a petroleum product shortfall in Nigeria.

“ It is against this backdrop that the contention of Dangote Refinery that there is no shortfall in the availability of petroleum products in Nigeria fails to convince. 

“ Thus, your lordship will find that from the bare and unsubstantiated facts deposed to in the Affidavit in support of the Originating Summons, the unassailable facts deposed to in the Defendants’ Counter Affidavit and in the absence of any confirmation/corroboration from the NMDPRA and NNPCL, it is glaring that the Plaintiff does not produce adequate and the needed quantity/volume of petroleum products for the daily use/consumption of Nigerians and Nigeria,” he contended.

• He stressed that apart from the Dangote Refinery, other companies/entities with a proven track record of international crude oil and petroleum products trading are eligible and qualified to be issued licenses to import petroleum products in Nigeria, in line with the PIA.
• Furthermore, Raji argued that while Dangote Refinery’s suit is inviting the Court to review the administrative decision of the NMDPRA, the plaintiff ought to have commenced the suit “by way of judicial review” as required by the provisions of Order 34 of the Federal High Court Civil Procedure Rules, 2019.
• He stressed that by judicial review, a court is concerned with the legality and not the merits of the decision or the acts of the public authority.

They urged the court to rely on the written address and refuse to void their import licenses.

Nairametrics reports that the case is slated for January 20, 2025, for a report.

 What you should know 

• When Dangote’s lawsuit became public, the Dangote Group later issued a statement describing the lawsuit against NNPC Limited and other oil companies as “an old issue.”
• In a statement on October 21, 2024, the group’s communications officer, Anthony Chiejina, clarified that Dangote Refinery plans to withdraw the suit by January 2025.

“This is an old issue that began in June and culminated in a matter being filed on September 6, 2024,” the statement read.

“Currently, the parties are in discussion following President Bola Tinubu’s directive on Crude Oil and Refined Products Sales in Naira, which was approved by the Federal Executive Council (FEC). We have made significant progress, and events have since overtaken this development.”

“No party has been served with court processes, and there is no intention to do so. We have agreed to put a halt to the proceedings. It is important to stress that no orders have been made, and there are no adverse effects on any party. We expect to formally withdraw the matter in court in January 2025.”

• Recall that Africa’s wealthiest man, Aliko Dangote, had announced his willingness to sell his multibillion-dollar oil refinery to the state-owned energy company, NNPC Limited.
• This decision came amid escalating disputes with regulatory authorities and equity partners, prompting reflection on his investment choices in Nigeria.
• Dangote was also seen alleging the importation of substandard petroleum products into Nigeria by others.
• Nairametrics previously reported that the federal government later granted marketers the license to buy petroleum products directly from the Dangote refinery following NNPC’s decision to quit as the middleman between the two parties.