Nigerian Court Rejects NNPC's Bid To Dismiss Dangote Refinery Lawsuit

Dangote Refinery Seeks to Halt Fuel Imports Amid Legal Dispute

A Nigerian Federal High Court has dismissed an objection from state-owned NNPC Ltd regarding its inclusion in a lawsuit filed by Dangote Oil Refinery. The case, initiated by Africa’s largest refinery, seeks to prevent fuel imports into Nigeria, arguing that its production capacity is sufficient to meet the nation’s gasoline demand.

Background: Dangote Refinery’s Push for Energy Independence

The 650,000-barrel-per-day Dangote Refinery, commissioned in Lagos, aims to reduce Nigeria’s dependence on imported refined petroleum. Despite being an oil-producing nation, Nigeria has historically relied on fuel imports due to limited refining capacity. The refinery, owned by billionaire Aliko Dangote, has positioned itself as a solution to the country’s energy crisis.

Lawsuit Challenges Fuel Importation

In its legal filing, Dangote Refinery contends that the Nigerian Midstream and Downstream Petroleum Regulatory Agency (NMDPRA) is breaching the law by continuing to issue fuel import permits. The lawsuit demands ₦100 billion ($65 million) in damages from NMDPRA, NNPC, and several smaller fuel marketers, citing that imports should only be allowed if there’s a supply shortfall. The refinery argues that it began producing gasoline in September last year and is capable of supplying the country’s needs.

NNPC’s Argument and Court’s Ruling

NNPC opposed the lawsuit, asserting that domestic fuel consumption still surpasses Dangote’s production capacity, necessitating imports. It also pointed out that the lawsuit erroneously named Nigeria National Petroleum Corporation, a non-existent entity, as the company had been rebranded as Nigeria National Petroleum Company Limited (NNPC Ltd) in 2022. However, presiding Judge Inyang Ekwo dismissed NNPC’s objections, allowing the case to proceed. A final ruling is expected on May 6, when the court will evaluate NNPC and NMDPRA’s motion to dismiss the case on grounds of insufficient merit.

Fuel Market Implications & Government Response

Nigeria, home to one of Africa’s largest gasoline markets, spent ₦15.42 trillion ($10 billion) on fuel imports in 2023, according to the National Bureau of Statistics. This lawsuit marks yet another confrontation between Dangote Group and Nigerian regulators, with the refinery previously accusing NMDPRA of permitting substandard fuel imports and failing to enforce domestic crude supply laws. Regulatory bodies have denied these claims.

What’s Next?

As the legal battle continues, stakeholders within Nigeria’s petroleum industry are closely watching how the decision will impact the country’s fuel supply policies. With the government’s push for economic diversification and self-sufficiency in oil refining, the outcome of this lawsuit could set a precedent for fuel regulation and refinery operations in Nigeria.