Dangote confirms suing NNPC, others but says matter overtaken by events

Dangote Refinery has confirmed that it sued the Nigeria National Petroleum Company Limited (NNPC) and other companies. The refinery, however, said the suit has been overtaken by events.

The company in a statement on Monday by its Group Chief Branding and Communications Officer, Anthony Chiejina, made this known in reaction to reports that it asked the Federal High Court in Abuja to void import licenses issued to the NNPC, Matrix Petroleum Services Limited, A.A. Rano Limited, and four other companies.

Nairametrics reported Monday that the Dangote Refinery in suit number FHC/ABJ/CS/1324/2024, also asked the court to award N100 billion in damages against the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) for allegedly continuing to issue import licenses to NNPC Ltd, Matrix, and other companies for importing petroleum products such as diesel and aviation fuel into Nigeria.

The case, according to the report, was adjourned to 20 January 2025.

Clarifying the suit, Mr Chiejina said the issue began in June and culminated in a matter being filed on 6 September. He said the parties have been engaged in discussions and events have overtaken the development.

According to him, the parties are now in discussion following President Bola Tinubu’s directive on crude oil and refined products sales in naira within Nigeria, approved by the Federal Executive Council (FEC). He added that once the matter comes up in January 2025, the refinery will formally withdraw the case.

“No fresh case filed against NNPC, others. This is an old issue that started in June and culminated in a matter being filed on September 6, 2024.

“Currently, the parties are in discussion since President Bola Tinubu’s directive on Crude Oil and Refined products sales in the Naira Initiative, which was approved by the Federal Executive Council (FEC).

“We have made tremendous progress in that regard and events have overtaken this development. No party has been served with court processes and there is no intention of doing 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 understand that once the matter comes up in January 2025, we would be in a position to formally withdraw the matter in court,” Mr Chiejina said.

Background

In recent months, the Dangote Group has been at loggerheads with NNPC, petroleum regulators and some private oil firms over the control of the petroleum downstream market.

In June, the Dangote Group accused some international oil companies of sabotaging the plant’s operations by either refusing to supply crude or offering oil at higher premiums compared to market prices.

It also clashed with the NMDPRA, which claimed diesel from the refiner has sulphur content levels above the allowed threshold. The regulator also accused Dangote of seeking to be a monopoly.

In refuting the allegation, the head of the Dangote Group, Aliko Dangote, took lawmakers visiting the refinery to a laboratory within the plant, where diesel from the refinery was tested alongside two different samples from imports.

The results showed the sample from the refinery’s diesel had much lower sulphur than the imported ones.

In July, the Federal Executive Council (FEC) directed NNPC Ltd to engage Dangote refinery and other local refineries with a view to resolving the dispute over the sale of crude oil to them. The FEC, presided over by President Bola Tinubu, also directed that such crude oil sales to the refineries be made in naira and that the refineries, located in Nigeria, should also sell their refined products to the Nigerian market in naira.

In October, the Nigerian government said it has officially commenced the sale of crude oil and refined petroleum products in Naira. The sale in Naira took effect from 1 October, the government said at the time.

PREMIUM TIMES also exclusively reported that NNPC Ltd has ended its exclusive purchase agreement with Dangote Refinery, opening up the market for other marketers to buy petrol directly from the refinery.

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This means the NNPC will no longer be the sole off-taker, and marketers can now negotiate prices directly with Dangote Refinery.

On 11 October, the Nigerian government confirmed NNPC’s stance.

This marks a departure from the previous arrangement where the NNPC Ltd served as the sole purchaser and distributor of petrol from the refineries, Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said.