Fresh tensions are emerging in Nigeria’s downstream oil sector as the Dangote Petroleum Refinery has moved to halt the continued importation of petrol into the country through a new lawsuit challenging fuel import licences granted to oil marketers and the Nigerian National Petroleum Company Limited (NNPCL) by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
Court documents seen by Reuters showed that the $20 billion refinery instituted the suit against Nigeria’s Attorney General, seeking to overturn import permits recently issued or renewed by the NMDPRA. The legal action represents a significant escalation in the long-running battle between Africa’s largest refinery and the country’s petroleum regulatory framework over whether fuel importation should continue when domestic refining capacity exists to meet national demand.
In the fresh filing before the Federal High Court in Lagos, the Dangote refinery asked the court to nullify import permits recently issued or renewed by the NMDPRA, arguing that the approvals violated an existing court order directing parties to maintain the status quo pending the determination of the matter.
The refinery maintained in its court filing that the licences issued this month “undermine its operations” and violate provisions of the law which, according to the company, only permit the importation of petroleum products when local production is unable to meet national demand.
The argument strikes at a fundamental question in Nigeria’s petroleum sector: whether the regulatory authority has the legal power to continue issuing import licences to marketers and the NNPCL at a time when the Dangote refinery is producing refined products on a commercial scale and has repeatedly claimed that it has sufficient capacity to meet Nigeria’s domestic fuel needs.
The legal dispute comes almost a year after Dangote Refinery withdrew an earlier case that similarly challenged the issuance of fuel import licences to the NNPCL and several fuel trading firms. The refinery had in July 2025 discontinued that previous lawsuit without publicly stating the reason for the withdrawal, leaving unresolved questions over market competition and the future structure of Nigeria’s fuel supply chain.
The decision to refile a substantially similar suit suggests that whatever considerations prompted the initial withdrawal — whether political pressure, behind-the-scenes negotiations, or strategic recalculation — have not produced the outcome the refinery desired, and the company has concluded that judicial intervention remains necessary to protect its market position.
The revival of the legal challenge also raises questions about what transpired between July 2025 and the present filing. During that period, the Dangote refinery significantly ramped up production and now operates above its 650,000 barrels per day nameplate capacity, with the refinery’s owner, Alhaji Aliko Dangote, recently disclosing that the plant has processed crude at 661,000 barrels per day. Data from the NMDPRA showed that domestic refinery supply dominated by the Dangote facility accounted for 76.7 per cent of Nigeria’s total petrol supply in the first quarter of 2026, with imports falling to just 23.3 per cent.
Despite these figures, the NMDPRA has continued to issue import licences, and fuel marketers have continued to bring in imported products.
Fuel marketers and regulators have repeatedly defended the continued issuance of import licences, insisting that petrol imports remain necessary to guarantee adequate supply across the country and prevent shortages in the domestic market.
The argument from the pro-importation camp is that relying exclusively on a single refinery regardless of its capacity creates supply chain risk, and that import licences serve as a safeguard against potential disruptions such as maintenance shutdowns, feedstock shortages, or distribution bottlenecks. They contend that until the domestic refining ecosystem is diversified and supply chains are fully stress-tested, maintaining the option to import is a matter of prudent energy security policy.
The NMDPRA had yet to respond to requests for comment as of the time of filing the report.
The lawsuit is the latest manifestation of a series of grievances the Dangote refinery has raised about what it perceives as systemic obstacles to its operations within Nigeria’s petroleum sector.
The refinery has previously accused Nigerian upstream oil producers of failing to supply crude oil to the facility as required under the Petroleum Industry Act (PIA), forcing it to rely heavily on international traders who charge additional premiums above the already elevated price of Nigerian crude.
In a statement issued by its management, the refinery said the situation had significantly increased operational costs, even as it struggled to maintain stable fuel supply in Nigeria amid global energy market volatility caused by the ongoing US-Iran conflict.
“The high crude cost is compounded by the fact that Nigeria upstream producers have failed to supply crude oil to the refinery as required under the PIA, forcing us to source a substantial portion through international traders who charge an additional premium,” the company stated.
The refinery explained that the situation has made crude procurement more expensive, particularly because Nigerian crude oil itself trades at a premium above global benchmark prices. This means the refinery is paying above-market rates for feedstock while simultaneously competing with imported products that may be sourced from cheaper crude grades processed at refineries abroad.
Aliko Dangote has also previously identified what he called “the Mafia” — a network of shippers, traders, and local beneficiaries of the fuel subsidy and importation regime who he alleged had attempted to sabotage the refinery because its success threatened their multi-billion-dollar business interests.
“The Mafia are the people who are actually benefiting because Nigeria was giving out almost $10 billion every year as a subsidy. There are shippers who are making tonnes of money. There are traders who are making a lot of money buying crude and sending us refined products,” Dangote had stated in a recent interview.
Nigeria has historically depended on imported petrol due to the long-standing poor performance of its four state-owned refineries in Port Harcourt, Warri, and Kaduna, which operated at minimal or zero capacity for years despite billions of dollars spent on turnaround maintenance. The country was spending billions of dollars annually importing refined fuel even though it is Africa’s largest crude oil producer.
The Dangote Petroleum Refinery, designed to process 650,000 barrels of crude oil per day and located in the Lekki Free Trade Zone in Lagos, was expected to significantly reduce or eliminate the country’s dependence on imported refined products when it commenced operations. The refinery has since demonstrated its capacity to produce petrol, diesel, aviation fuel, and polypropylene on a commercial scale, and Dangote has announced plans to more than double capacity to 1.4 million barrels per day within the next 30 months.
Despite the commencement and scaling up of operations at the facility, fuel importation has persisted, with industry players arguing that imported products are still required to bridge supply gaps as the refinery continues to expand output. The Dangote refinery, however, contests this characterisation, maintaining that its production is more than sufficient to meet Nigeria’s domestic fuel needs and that continued importation is being driven by commercial interests rather than genuine supply deficits.
The latest court action is likely to intensify conversations around fuel market regulation, local refining capacity, and the broader implementation of Nigeria’s petroleum laws especially amid growing expectations that domestic refineries should gradually take over the country’s fuel supply needs.
The case also presents the Federal High Court with a significant policy question embedded in a legal dispute: whether the NMDPRA has the power to continue licensing fuel imports in the face of demonstrated domestic production capacity, or whether the PIA and other relevant laws require the regulator to give priority to locally refined products and restrict imports to situations of genuine shortfall.
The outcome of the lawsuit could fundamentally reshape the structure of Nigeria’s downstream petroleum market, either cementing the Dangote refinery’s position as the dominant and potentially exclusive supplier of refined fuel to the Nigerian market, or affirming the right of regulators to maintain an open import window alongside domestic refining.
The post “Fuel Import Licences Undermine Our Operations” — Dangote Refinery Sues To Stop NMDPRA, NNPCL, Marketers From Importing Petrol appeared first on TheNigeriaLawyer.
