Dangote’s plan to dominate Nigeria’s oil industry could trigger economic chaos, warn marketers

Three major oil marketers in Nigeria have warned that a plan by Dangote Petroleum Refinery to dominate the country’s oil industry could cause serious problems for the economy and the people.

The marketers—AYM Shafa Limited, A. A. Rano Limited, and Matrix Petroleum Services Limited—have told the Federal High Court in Abuja that giving Dangote control over Nigeria’s oil sector could lead to higher prices for fuel and other energy products. They believe this would hurt ordinary Nigerians and make the country’s economy even weaker.

In a legal case filed on September 6, 2024, Dangote Petroleum Refinery sued several companies and organizations, including the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Nigerian National Petroleum Corporation (NNPCL). Dangote asked the court to decide that NMDPRA had broken the law by allowing companies like the marketers to import petroleum products into Nigeria.

Dangote claimed that the only time these import licenses should be allowed is if there is a shortage of petroleum products in the country. Dangote also argued that NMDPRA wasn’t doing enough to support local refineries, like Dangote’s, that could produce enough oil for the country.

However, in their court reply dated November 5, 2024, the three marketers disagreed with Dangote’s claim. They argued that they are fully qualified to import petroleum products into Nigeria and that they meet all the legal requirements for the licenses they’ve been given.

The marketers told the court that giving Dangote too much power in the oil sector would hurt Nigeria. They said it would create a monopoly—meaning only Dangote would be allowed to produce and sell oil. This, they believe, could lead to rising prices for fuel and make it harder for people to afford the energy they need. They also warned that if something went wrong with Dangote’s refinery, Nigeria could face a serious energy crisis since the country doesn’t have enough backup supplies.

The marketers added, “If Nigeria puts all her energy eggs in one basket by stopping the importation of petroleum products and allowing Dangote to be the only producer and supplier of these products, the prices will keep rising, and energy security will be in danger. If there’s a problem with Dangote’s refinery, the country could run out of fuel, and there won’t be enough time to bring in more.”

They also pointed out that there is no proof that Dangote’s refinery is currently able to produce enough petroleum products to meet the country’s daily needs. Giving Dangote control over the entire industry, they said, would only make Nigeria depend on one company for all its energy needs, and this could lead to big problems for the country’s economy.

Finally, the marketers emphasized that the import licenses they hold were issued legally and in line with the law. They argued that allowing them to continue importing petroleum products does not harm Dangote’s business or his refinery. Instead, they said, it helps keep the oil market competitive and ensures that Nigerians won’t have to depend on just one supplier.