Dangote Petroleum Refinery Seeks Legal Action Against NNPC and Others Over Import Licenses
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Dangote Petroleum Refinery Seeks Legal Action Against NNPC and Others Over Import Licenses
Legal Challenge
Dangote Petroleum Refinery and Petrochemicals FZE has filed a lawsuit in the Federal High Court in Abuja, demanding the annulment of import licenses granted to the Nigerian National Petroleum Corporation Limited (NNPC), Matrix Petroleum Services Limited, A. A. Rano Limited, and four other companies. The refinery argues that these licenses are unnecessary since it is already producing refined petroleum products without any shortfall.
Details of the Lawsuit
In the suit, marked FHC/ABJ/CS/1324/2024, Dangote Refinery is also seeking N100 billion in damages from the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA). The refinery claims that NMDPRA continues to issue import licenses for products such as Automotive Gas Oil (AGO) and Jet Fuel, despite Dangote’s capacity to meet the country’s demands.
The defendants in the case include NMDPRA, NNPC, Aym Shafa Limited, A. A. Rano Limited, T. Time Petroleum Limited, 2015 Petroleum Limited, and Matrix Petroleum Services Limited.
Allegations of Regulatory Violations
Dangote’s legal team, led by Ogwu James Onoja, SAN, argues that the NMDPRA is violating Sections 317(8) and (9) of the Petroleum Industry Act by issuing import licenses when local production is sufficient. They contend that licenses should only be granted in cases of product shortages and criticize NMDPRA for not supporting local refineries.
Impact on Business
In an affidavit from Ahmed Hashem, Group General Manager at Dangote Refinery, the company asserts that the import licenses issued to competitors are undermining its business, which has invested billions of dollars in local production. Hashem claims that the refinery’s products are not being adequately utilized due to the actions of NMDPRA.
He also expressed concerns over a proposed 0.5% levy on wholesale transactions imposed by NMDPRA, which he argues is contrary to statutory regulations for entities operating in Free Zones. Hashem stated that the establishment of Free Zones aims to promote competition and attract foreign investment.
Call for Court Intervention
The plaintiff has requested an injunction to prevent NMDPRA from issuing or renewing import licenses to the defendants. Additionally, they seek general damages of N100 billion and an order for NMDPRA to seal off facilities used for importing refined products.
Dangote’s legal team highlighted that the continued issuance of import licenses jeopardizes their investments and urged the court’s intervention to address the alleged regulatory violations.
Potential for Settlement
During a recent court session before Justice Inyang Ekwo, counsel for Dangote Refinery, George Ibrahim, SAN, informed the judge about ongoing discussions between the parties aimed at a possible settlement. He requested an adjournment to allow for further negotiations, which Justice Ekwo granted. The case has been adjourned until January 20, 2025, for a report on the progress of the settlement discussions.
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