Dangote Petroleum Refinery and Petrochemicals FZE has urged the Federal High Court in Abuja to dismiss the preliminary objection of the Nigerian National Petroleum Company Limited (NNPCL) against its N100 billion import licenses lawsuit.
The legal team of Dangote Petroleum Refinery and Petrochemicals accused NNPCL of being a “busybody” and “meddlesome interloper” attempting to kill a suit that seeks the court’s interpretation of certain sections of the Petroleum Industry Act (PIA).
On Thursday, the court adjourned the Dangote Petroleum Refinery and Petrochemicals FZE import license lawsuit against NNPCL, Matrix Petroleum Services Limited, A.A. Rano Limited, and four other companies.
Nairametrics previously reported that Dangote Refinery’s legal team had sought to amend the suit to correct a “clerical spelling” error on January 30, but the request could not be heard due to NNPCL’s insistence on resolving its preliminary objection first.
Nairametrics also reported that Dangote Petroleum Refinery and Petrochemicals FZE had filed a suit seeking to void import licenses issued to NNPCL, Matrix Petroleum Services Limited, A.A. Rano Limited, and four other companies for importing refined petroleum products.
The refinery argues that these products are already being produced domestically without shortfalls.
In suit number FHC/ABJ/CS/1324/2024, Dangote Refinery is seeking N100 billion in damages against the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) for allegedly continuing to issue import licenses to NNPCL, Matrix, and other companies for importing petroleum products such as Automotive Gas Oil (AGO) and Jet Fuel (aviation turbine fuel) into Nigeria.
What Transpired in Previous Proceedings
Dangote Refinery’s suit claims that the importation of petroleum products persists “despite the production of AGO and Jet-A1 that exceeds the current daily consumption of petroleum products in Nigeria by Dangote Refinery.”
The defendants in the case include NMDPRA, NNPCL, AYM Shafa Limited, A.A. Rano Limited, T. Time Petroleum Limited, 2015 Petroleum Limited, and Matrix Petroleum Services Limited.
In its originating summons dated September 6, 2024, seen by Nairametrics, the plaintiff’s lawyer, George Ibrahim, SAN, argued that NMDPRA allegedly violated Sections 317(8) and (9) of the Petroleum Industry Act by issuing import licenses for petroleum products, which should only be granted when there is a proven shortfall in supply.
Days after the suit was filed and adjourned, three oil companies—Matrix Petroleum Services Limited, A.A. Rano Limited, and AYM Shafa Limited—filed a motion urging the court to dismiss the suit.
They argued that only NMDPRA and NNPCL are legally empowered to determine petroleum product shortfalls in Nigeria, not Dangote Refinery.
In their counter-affidavit dated November 5, 2024, attached to a written address seen by Nairametrics, the companies, through Ahmed Raji, SAN, sought an order prohibiting NMDPRA from reviewing or withdrawing their import licenses.
Meanwhile, NNPCL’s counsel, Ademola Abimbola, SAN, filed a preliminary objection, arguing that the plaintiff erroneously sued “Nigeria National Petroleum Corporation,” a non-existent entity, instead of the correctly registered “Nigerian National Petroleum Company Limited.”
Abimbola also argued that until NMDPRA decides to apply the “Backward Integration Policy” in the downstream petroleum sector, it is not under any obligation to restrict the issuance of petroleum product import licenses solely to cover shortfalls in local refinery production.
The Backward Integration Policy, a provision in the PIA, encourages investment in local refining facilities by granting import licenses for refined products only to companies involved in domestic refining.
NNPCL urged the court to hold that the enactment of a Backward Integration Policy in the downstream petroleum sector is a prerequisite before Dangote Refinery can challenge NMDPRA’s continued issuance of import licenses to the 2nd to 7th defendants.
Abimbola further urged the court to rule that Dangote Refinery has no legal right to institute this suit.
The court had at the last sitting, directed Dangote Refinery to provide a formal response to NNPCL’s objection, ahead of the next proceedings on February 5, 2025.
Dangote Refinery Counters NNPCL
- In its counter-affidavit and written address filed on Friday, and seen by Nairametrics, George Ibrahim argued that a close examination of the originating summons, affidavit, and attached documents shows without ambiguity that the plaintiff’s grievance concerns the “flagrant disobedience of the Petroleum Industry Act (PIA) by a statutory body created to implement the Act.”
- He stated that Dangote Refinery is asking the court to interpret the Act’s provisions and direct the parties involved to comply, particularly with Sections 317(8) and (9).
- He also argued that, in compliance with the Petroleum Act, the company issued a Pre-Action Notice (Exhibit F).
“It is therefore our most humble submission that there is no other or further condition precedent required from the Plaintiff that has not been met, and nothing prevents this Court from exercising its jurisdiction,” he argued.
- He urged the court to reject NNPCL’s claim that the plaintiff failed to demonstrate the implementation of a Backward Integration Policy by NMDPRA.
- He contended that a policy by a government institution cannot override the provisions of an Act.
- He further submitted that NNPCL has no legal basis to argue that “the plaintiff failed to show the implementation of a Backward Integration Policy by NMDPRA” since it is not a representative of NMDPRA in this matter.
“The NNPCL is merely a busybody and a meddlesome interloper, and its arguments on this issue should be disregarded,” he stated.
Ibrahim also argued that NNPCL will not suffer any prejudice if its name is corrected in the lawsuit, allowing it to respond to the allegations and be bound by the case outcome.
He pointed out that, even though NNPCL was not served with the originating summons like the other defendants, its lawyers voluntarily obtained the court processes and filed a preliminary objection solely on the basis of a clerical error in its name.
He said that while his client has applied to correct NNPCL’s name, NNPCL is seeking to dismiss the entire suit, even though there are other competent defendants involved, which means the suit remains valid with or without NNPCL.
He asked the court to rule that a preliminary objection like NNPCL’s becomes “useless” once a motion for amendment is allowed, citing numerous appellate court decisions.
He further urged the court to dismiss NNPCL’s preliminary objection in the interest of justice.
What You Should Know
- Africa’s richest man, Aliko Dangote, recently announced his willingness to sell his multibillion-dollar refinery to NNPCL amid escalating disputes with regulators and equity partners.
- Dangote had previously accused other importers of bringing substandard petroleum products into Nigeria.
- Nairametrics reported that the federal government later allowed marketers to purchase petroleum products directly from Dangote Refinery, following NNPCL’s decision to withdraw as an intermediary between the refinery and marketers.
