The Nigerian National Petroleum Company Limited (NNPC Ltd.) has urged the Federal High Court in Lagos to dismiss a suit filed by Dangote Petroleum Refinery and Petrochemicals FZE, arguing that petroleum products produced by the refinery are sold at “significantly high and fluctuating market prices” and warning that granting the company's requests could create a monopoly in Nigeria’s downstream petroleum sector.
NNPC made the submission in a counter-affidavit filed in response to Dangote Refinery’s originating summons in Suit No. FHC/L/CS/857/2026 before the Federal High Court, Lagos Judicial Division.
The position of the national oil company was supported by the Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN), which maintained that competition should be preserved in the downstream sector to prevent potential price exploitation. The association argued that allowing multiple supply sources would encourage competitive pricing and ultimately reduce fuel costs for consumers.
According to documents obtained by our correspondent, NNPC asked the court to either dismiss or strike out the suit, contending that it is incompetent, premature, lacks a valid cause of action, and amounts to an abuse of court process.
Dangote Tackles Importers
The legal dispute stems from Dangote Refinery’s challenge to the issuance of petrol import licences by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to marketers and NNPC.
The refinery had questioned the regulator’s decision to approve licences for the importation of more than 700,000 metric tonnes of Premium Motor Spirit (PMS), commonly known as petrol, despite its claim that it currently supplies over 90 per cent of Nigeria’s daily petrol consumption requirements.
In the suit, Dangote Refinery asked the court to invalidate the import permits granted to fuel importers by the NMDPRA, arguing that the approvals contravene existing regulations and violate an earlier court order directing parties to maintain the status quo.
The refinery also accused NNPC and other stakeholders of undermining its $20 billion investment, alleging that it has faced challenges in accessing adequate crude oil supplies while fuel importation continues despite its capacity to meet the country's demand for petrol, diesel, and other refined petroleum products.
NNPC Defends Fuel Import Licences, Warns Against Monopoly Risks
The Nigerian National Petroleum Company Limited (NNPC Ltd.) has urged the Federal High Court in Lagos to dismiss the suit filed by Dangote Petroleum Refinery, arguing that the action is premature and that the refinery lacks the legal standing to institute the case.
In a counter-affidavit filed before the court, the national oil company disclosed its intention to challenge the competence of the suit through a preliminary objection.
“The plaintiff’s suit is premature; the plaintiff lacks locus standi,” the affidavit stated.
NNPC further contended that petroleum products produced by the Dangote refinery are already sold at prices driven by market forces and commercial considerations.
“The plaintiff’s petroleum products are already sold at significantly high and fluctuating market prices, dictated by its commercial interests,” the company said.
The state-owned oil firm also accused the refinery of engaging in forum shopping by filing multiple suits on similar issues in different judicial divisions of the Federal High Court.
“The institution of multiple actions by the plaintiff in respect of substantially the same subject matter and reliefs constitutes an abuse of court process and amounts to forum shopping,” NNPC argued.
According to the company, Dangote Refinery had previously instituted a similar case before the Abuja Division of the Federal High Court in Suit No. FHC/ABJ/CS/1324/2024 against the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and six other defendants before withdrawing the matter and filing a fresh action in Lagos.
NNPC also challenged the refinery’s assertion that it can independently meet Nigeria’s fuel demand, insisting that no credible evidence has been presented before the court to support such claims.
“There is no credible, independent, or verifiable evidence before this honourable court establishing that the plaintiff presently satisfies the petroleum product demands of Nigeria,” the company submitted.
The oil firm maintained that Dangote Refinery had not provided independently verified data on the country’s daily fuel consumption or proof of its capacity to sustain uninterrupted nationwide supply.
“The plaintiff has failed to place before this Honourable Court any comprehensive or independently verified evidence establishing the actual daily national consumption rate of petroleum products in Nigeria or the plaintiff’s ability to guarantee uninterrupted nationwide petroleum supply independently,” it stated.
NNPC further argued that the refinery’s production figures alone cannot justify restrictions on fuel imports.
“The plaintiff’s alleged production figures are selective, incomplete, and incapable of establishing nationwide product sufficiency,” the affidavit read.
The company stressed that national fuel supply extends beyond refining capacity and encompasses logistics, storage, transportation, distribution, evacuation, haulage, and strategic reserve management.
Warning against overreliance on a single supplier, NNPC said such a situation could pose serious threats to the country's energy security.
“Reliance on a single supplier within the petroleum industry poses grave risks to national energy security,” it stated.
The company also cautioned that restricting fuel importation channels as requested by the refinery could expose the country to supply shortages and market instability.
“Restricting importation channels in the manner sought by the plaintiff would expose Nigeria to severe risks of petroleum shortages, supply disruptions, price instability, distribution failures, and national energy crises,” the affidavit stated.
NNPC noted that any operational disruption at the Dangote refinery could trigger severe fuel shortages nationwide if alternative importation channels are eliminated.
It further accused the refinery of seeking to dominate the downstream petroleum market by limiting the participation of other operators.
“The reliefs sought by the plaintiff are aimed at substantially restricting or eliminating other participants within the petroleum importation and supply chain. The grant of the plaintiff’s reliefs would effectively expose Nigeria’s petroleum sector to monopoly control and undermine competitive participation within the industry,” the company argued.
According to NNPC, a monopolistic market structure could negatively affect consumers and the broader economy by distorting competition, weakening pricing stability, and reducing supply flexibility.
The company also defended the continued issuance of fuel import licences by regulators, maintaining that the practice remains lawful and necessary for safeguarding energy security and maintaining market stability.
NNPC argued that the relevant provisions of the Petroleum Industry Act (PIA) do not prohibit fuel imports and merely grant discretionary powers to regulators under the backward integration policy framework.
“Section 317(9) of the Petroleum Industry Act expressly contemplates the issuance of import licences to companies with active local refining licences or proven track records in international crude oil and petroleum products trading,” the company stated.
NNPC further argued that the provisions of the Petroleum Industry Act (PIA) do not impose an outright ban on fuel imports, maintaining that the law grants regulators discretionary powers in implementing policies aimed at encouraging local refining.
“Section 317(8) of the Petroleum Industry Act merely provides that the Authority may apply a backwards integration policy in the downstream petroleum sector, thereby conferring discretionary powers on the regulatory authorities rather than imposing a mandatory prohibition on petroleum importation,” the company stated.
The national oil company also defended the conduct of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), and other government agencies, rejecting claims that they had obstructed the operations of Dangote Refinery.
“The 2nd Defendant, NMDPRA, NUPRC and other relevant agencies of government have not frustrated the plaintiff in the execution of its business objectives or refinery operations in any manner whatsoever,” NNPC said.
The company equally dismissed allegations that it had deliberately denied crude oil supplies to the refinery or engaged in actions aimed at undermining its operations.
“The government and the 2nd Defendant have not deliberately denied the plaintiff a crude oil supply,” the affidavit stated.
It added: “Contrary to the plaintiff’s allegations, the 2nd Defendant has not sabotaged the plaintiff’s refinery operations.”
According to NNPC, crude supply arrangements are influenced by a range of factors, including “operational realities, commercial arrangements, security considerations, production levels, logistical constraints, and contractual obligations".
The company maintained that all decisions relating to fuel importation, licensing, supply, and distribution have been made in accordance with the Petroleum Industry Act, prevailing market conditions, and national interest considerations.
NNPC also argued that Dangote Refinery remains one of several participants in the petroleum industry and cannot supersede the rights of other operators within the sector. The company noted that it continues to function as the supplier of last resort in ensuring fuel availability across the country.
The legal dispute marks the second major courtroom confrontation between Dangote Refinery and key government oil agencies since the commencement of operations at the multi-billion-dollar refinery located in Lekki, Lagos, and owned by businessman Aliko Dangote.
The refinery had withdrawn a similar suit filed in 2024 following the intervention of the federal government. The dispute centres on disagreements over fuel importation, crude oil supply arrangements, market competition, and the interpretation of the Petroleum Industry Act in the post-subsidy era.
Since the removal of the petrol subsidy in 2023, fuel pricing has largely been determined by market forces, intensifying competition among marketers, importers, refiners, and regulators over supply and pricing dynamics.
Dangote Refinery has previously faced criticism from some petroleum marketers over its repeated reductions in petrol prices, which they argued negatively affected their businesses and profit margins.
The refinery, which commenced petrol production in 2024 after years of construction delays and significant capital investment, has consistently advocated stronger government support for local refining. It has also called for tighter restrictions on fuel imports, arguing that continued importation undermines domestic refining capacity.
The company had earlier accused regulatory authorities of approving import licences despite its claim that local refining output is sufficient to satisfy domestic demand.
However, NNPC, petroleum marketers, and regulators have maintained that multiple supply channels remain necessary to guarantee energy security, citing distribution challenges, emergency supply requirements, strategic reserve obligations, and uncertainties regarding actual nationwide fuel consumption levels.
Marketers Throw Weight Behind NNPCL
There are indications that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and several petroleum marketers may seek to join the ongoing legal battle involving Dangote Refinery and the Nigerian National Petroleum Company Limited (NNPC).
Commenting on the matter, the National President of the Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN), Billy Gillis-Harry, said while every corporate entity has the constitutional right to pursue legal remedies, the downstream petroleum sector must continue to promote competition, market stability, and energy security in the interest of Nigerians.
According to him, competition remains essential “for ensuring product availability, price moderation, efficiency, and sustainability within the petroleum distribution value chain".
Gillis-Harry stressed that Nigeria's petroleum market should not be allowed to drift towards monopoly, regardless of the size of investment or refining capacity controlled by any single operator.
The PETROAN president maintained that the downstream sector must remain open, competitive, and balanced in order to “prevent supply shocks and protect consumers from artificial scarcity or price exploitation".
While acknowledging the substantial investment made by Dangote Refinery, he commended the facility for boosting local refining capacity, creating jobs, and helping to reduce the country's dependence on imported petroleum products.
However, he emphasised the need to preserve a liberalised market environment where multiple operators can compete fairly under the supervision of the federal government and relevant regulatory agencies.
Gillis-Harry added that one of the key advantages of healthy competition in the downstream petroleum sector is the “reduction in fuel prices through competitive pricing".
