The Dangote Refinery has announced its intention to withdraw the legal case it filed against the Nigerian National Petroleum Corporation Limited (NNPCL) and five other petroleum companies over fuel importation.
The refinery had earlier sued the NNPCL, Aym Shafa Limited, A. A. Rano Limited, T. Time Petroleum Limited, 2015 Petroleum Limited, and Matrix Petroleum Services Limited, accusing them of illegally importing petroleum products.
In its suit, Dangote Refinery sought N100 billion in damages from the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) for allegedly issuing licences to the NNPCL and the other companies for the importation of Automotive Gas Oil (AGO) and Jet Fuel.
The refinery claimed that the importation of these products was unnecessary, given that its own production exceeds the country’s daily consumption needs.
However, in a statement released on Monday, Anthony Chiejina, Group Chief Branding and Communications Officer for Dangote Group, clarified that the suit is now being dropped.
Chiejina explained that the case was filed back in September 2024, but the issue itself had been brewing since June.
“This is not a new matter. The suit was filed in September after lengthy discussions between the parties,” Chiejina said.
He also revealed that since the Nigerian government’s recent decision to sell crude oil and refined products in Naira, significant progress has been made in resolving the dispute.
“Following President Bola Tinubu’s directive on the sale of crude oil and refined products in Naira, events have overtaken this issue. Discussions are ongoing, and we’ve agreed to withdraw the case,” he stated.
Chiejina noted that none of the parties involved had been served with court papers, signaling that the case had not yet progressed in the legal system.
“There is no intention to serve any court processes, and we have all agreed to halt the proceedings,” he added.
This development comes as a relief to the parties involved and signals a step forward in the government’s initiative to restructure Nigeria’s oil and gas sector.
In the original lawsuit, Dangote Refinery argued that the NMDPRA had violated the Petroleum Industry Act (PIA) by continuing to issue import licences for petroleum products, even though local production was more than sufficient.
The PIA was enacted to regulate the Nigerian petroleum industry more effectively and promote transparency and competition.
According to Dangote, the decision to allow importation hurt its business, as it reduces the demand for locally produced petroleum products.
But the government’s recent reforms, including the Naira-based sales directive, have eased tensions, allowing the parties to come to an amicable agreement.
This case highlights the ongoing challenges in Nigeria’s oil and gas industry, particularly in relation to refining capacity and importation.
While Dangote’s 650,000-barrel-per-day refinery is expected to significantly reduce Nigeria’s dependence on imported petroleum products, the industry is still adjusting to the changes brought by the Petroleum Industry Act.
With the government pushing for more local production and refining, many expect that disputes like this will become less frequent as the sector becomes more self-sufficient.
However, balancing the interests of local producers like Dangote Refinery with the needs of established importers and regulators remains a challenge.