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Energy Monopoly Showdown: Oil Marketers Fight Dangote Refinery's Bid to Control Nigeria’s Energy Sector

By Achimi Muktar

In a tense legal standoff that could reshape Nigeria's energy landscape, prominent oil marketers have urged a Federal High Court to block Dangote Refinery’s attempt to dominate the country’s petroleum sector, warning that such a move would spell disaster for the economy.

The oil marketers, including AYM Shafa Limited, A. A. Rano Limited, and Matrix Petroleum Services Limited, filed their response to a lawsuit initiated by Dangote Refinery, challenging their rights to import refined petroleum products into the country. The case has raised serious concerns over the potential for a monopoly in Nigeria's vital oil industry.

In its suit, Dangote Refinery is asking the court to nullify the import licenses issued to these marketers by the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Nigerian National Petroleum Corporation Limited (NNPC). Dangote claims that its refinery is producing enough petroleum products to meet national demand, rendering imports unnecessary.

The marketers, however, vehemently disagree. In their court submission, they argue that Dangote’s refinery is not capable of supplying the nation’s daily consumption needs and that granting it exclusive rights would cripple competitive pricing and worsen Nigeria’s economic struggles. They warned that a single-supplier system would drive up the prices of petroleum products, placing a heavy burden on ordinary Nigerians.

“Allowing Dangote Refinery to monopolize the oil sector would lead to unchecked price hikes and energy insecurity,” the marketers argued. They cautioned that the country lacks the reserves needed to cushion the blow in case of a disruption in Dangote's supply chain.

The oil marketers highlighted the importance of keeping competition alive in the petroleum industry to protect the country from potential crises. They emphasized that their import licenses were lawfully granted under the Petroleum Industry Act (PIA), which allows for competitive practices to ensure stable pricing and supply.

The marketers further stated that eliminating competition would not only devastate the economy but would also leave Nigerians vulnerable to the whims of a single company for their energy needs. “If we put all our energy eggs in one basket, we risk catastrophic consequences in the event of any failure on Dangote’s part to meet the nation’s demand,” they added.

Efforts to reach Dangote Group for comment were unsuccessful, as several calls and messages to their spokesperson went unanswered.

With the potential for far-reaching implications on Nigeria’s energy security and economic stability, Justice Inyang Ekwo has adjourned the matter until January 2025. The court has encouraged both parties to explore an out-of-court settlement, but the marketers remain resolute in their stance against a monopoly in the energy sector.

The case is sure to be closely watched as it unfolds, with millions of Nigerians anxiously awaiting the outcome that could affect everything from fuel prices to the stability of the country’s energy supply.