Petrol Economy: Ensuring a Level Playing Field for All Players

Dangote Refinery last week withdrew its N100 billion lawsuit at the Federal High Court, Abuja, challenging the Federal Government’s 15% tariff on imported petroleum products. The suit, presided over by Justice Mohammed Umar, followed the issuance of fuel import permits by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to firms including NNPCL, AYM Shafa Ltd, AA Rano Ltd, T. Time Petroleum Ltd, 2015 Petroleum Ltd, and Matrix Petroleum Services Ltd.

The measure, reportedly endorsed by President Bola Tinubu, seeks to promote a robust and diversified petroleum economy under the Petroleum Industry Act (PIA) while safeguarding national interests. Dangote Refinery had argued that the import permits threatened its investment and the growth of domestic refining.

Over the past year, Nigeria has witnessed a resurgence in indigenous refining capacity, easing decades-long fuel scarcity and reducing reliance on black markets. Dangote Refinery alone now produces 650,000 barrels per day, with plans to increase to 1.4 million barrels within three years. In addition, around 20 conventional and modular refining plants are either operational or under construction nationwide.

Experts stress that while domestic refiners must be protected, importers and blending operators also play a critical role in ensuring a stable supply of petroleum products. Diversifying players in the sector encourages healthy competition, drives efficiency, creates employment opportunities, enhances energy security, and generates revenue.

The growing number of domestic and international players, coupled with protective policies, is expected to drive down fuel costs while positioning Nigeria as a key petroleum hub in Africa.

“Diversification benefits all. It strengthens local capacity, stabilizes supply, and improves competitiveness without undermining the gains of domestic refiners,” analysts say.