On Wednesday, President Bola Tinubu sought Senate’s approval for the nomination of chief executives for the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
This came on the heels of the resignation of Engr. Farouk Ahmed of the NMDPRA and Engr. Gbenga Komolafe of the NUPRC, who were both appointed in 2021 by the then President Muhammadu Buhari to lead the two regulatory agencies created through the Petroleum Industry Act (PIA).
The President of Dangote Industries Limited, Alhaji Aliko Dangote was at the edge of the resignation of the two chief executives, a few years after the birth of the PIA. Dangote and the former NMDPRA boss, Farouk, were at daggers drawn over an alleged corruption in granting import licences, which the former said was calculated to frustrate indigenous refining business.
According to records, Nigeria imported over 72% of its petrol in the first nine months of 2025, indicating a continued reliance on imports despite Dangote’s increasing output. Nigeria’s petrol imports increased to an average of 52.1 million litres per day in November 2025. Dangote claimed that 47 licences had been issued, which created an environment where traders could import, even as new refineries struggled to build due to regulatory conflicts.
Harmonised PIA
Petrol importation licence, according to Section 317 (8), will be granted to holders of refining licence or companies with “proven track records of international crude oil and petroleum products trading”. It states that the Authority may apply the Backward Integration Policy in the downstream petroleum sector to encourage investment in local refining.
It added: “Pursuant to subsection (8), licence to import any product shortfalls may be assigned to companies with active local refining licences or proven track records of international crude oil and petroleum products trading.
“Import volume to be allocated between participants shall be based on criteria to be set by the Authority, taking into account their refining output in the preceding quarter, the share of active wholesale customers competitive pricing and prudent supply, storage and distribution track records”.
Import brouhaha, Dangote’s heartache
The billionaire also accused the leadership of the NMDPRA of colluding with international traders and oil importers to frustrate local refining through the continued issuance of import licences for petroleum products. He said that despite his refinery’s effort to keep pump prices low, ‘some people are really bent on destroying the economy of the country by making sure that they keep issuing licences to bring in products from Russia’.
He disclosed that the NMDPRA had issued ‘reckless licences’ for the importation of ‘about 7.5 billion litres’ of premium motor spirit (PMS) for the first quarter (Q1) of 2026 despite assuring Nigerians of adequate supply.
“The Russian product is at a discount. It is at a $20 to $25 discount in terms of tonnage of crude. Nigeria’s own is starting from a premium of $2 to $3, so there is an imbalance of about $28. As far as I am concerned, Nigerians are paying a very great price because it is destroying the downstream refineries.
“When you look at it now, how many downstream actors do we have? All the foreign companies have actually left the country – Shell and co – all of them have gone offshore. Nobody is operating downstream”, he said.
According to the Dangote Group Chairman, modular refineries are already struggling under the current policy environment and on the brink of extinction, while the persistent issuance of import permits further weakens the sector. He said the downstream sector was under severe strain, alleging the presence of entrenched interests that profit from fuel imports at the expense of national development.
Dangote alleged: ‘There are powerful interests in the oil sector. It is troubling that African countries continue to import refined products despite long-standing calls for value addition and domestic refining. The volume of imports being allowed into the country is totally unethical and does disservice to Nigeria. It is not good. We have already built our own. Other people will not be able to build their own if this thing continues’, Dangote said.
He stressed the need for a clear separation between regulatory oversight and commercial interests, warning that allowing traders to influence regulation would undermine the integrity of the sector. ‘The downstream sector must not be destroyed by personal interests. A trader should never be a regulator. Forty-seven licences have been issued, yet no new refineries are being built because the environment is not conducive’, he added.
He further alleged that domestic refiners were forced to buy Nigerian crude at premiums of up to four dollars per barrel from the trading arms of international oil companies, placing them at a competitive disadvantage. He called on the government to ensure that crude oil taxes are assessed based on actual transaction values, warning that the current system allows under-declaration and revenue losses.
NMDPRA’s defence
In May 2023, Ahmed announced NMDPRA’s readiness to issue licences to companies interested in petrol importation. He said the PIA 2021 empowered his agency to issue licences to refiners or producers of crude oil who meet the requirements.
But defending its decision to issue import licences to oil marketers despite local refining by Dangote Refinery, NMDPRA explained that it was due to shortfall in local refining.
Dangote Refinery was yet to meet the national daily petroleum products sufficiency requirement. The counter affidavit was deposed to by Idris Musa, a senior regulatory officer in the NMDPRA.
Besides, the NMDPRA addressed Dangote Refinery’s argument against a 0.5% levy, insisting that it aligns with Sections 47(2)(c) and 52(7) of the PIA and that the levy must be paid at wholesale points by customers, not producers; sometimes it stated that Dangote Refinery was aware of it.
‘The plaintiff (Dangote) cannot claim not to be bound by local laws due to its being in a free zone, whilst seeking to take the benefits of the same local laws. The plaintiff is to remit such levies to the 1st defendant not later than 21 days following the month of the sale’, he said.
More delight for Nigerians
A Public Relations, Policy and Governance analyst, Kunle Odusola-Stevenson told Weekend Trust that Dangote’s pricing actions – cutting gantry prices and triggering broader market competition – resulted in lower pump prices, improved availability and the near elimination of queues.
Importers continue to have a legitimate transitional role, particularly during maintenance cycles or shortfalls, but unrestricted imports in the face of available local capacity undermine Nigeria’s energy independence goals and strain foreign exchange reserves. In that context, he said Dangote’s advocacy was consistent with national interest rather than protectionism.
Ruffled by importers?
Odusola-Stevenson hinted that the prospects were strong, provided policy consistency and regulatory neutrality maintained. Indigenous leadership across the value chain, including Oando under Wale Tinubu, actually strengthens the case for domestic refining rather than weakening it, he said.
He said that Oando’s expansion following the Nigerian Agip Pil Company (NAOC) acquisition enhanced upstream production and crude availability, which ultimately supports local refineries.
He added: “Economic sovereignty does not mean excluding importers; it means ensuring that imports serve as a buffer, not the backbone of supply. Prioritising domestic refining, particularly large-scale capacity like Dangote’s, maximises value retention, supports employment and reduces forex exposure. Importers should complement this framework by bridging verified gaps, not displacing local production through arbitrage.
‘Encouragingly, industry signals point in this direction. Associations such as the Independent Petroleum Marketers Association of Nigeria (IPMAN) increasingly advocate sourcing from local refineries, while regulatory reforms and oversight by NUPRC and NMDPRA indicate a shift toward enforcing PIA objectives. When indigenous upstream, midstream and downstream players are aligned, prioritising local refining becomes both realistic and economically rational’, Odusola-Stevenson said.
Importation conundrum
Stakeholders are of the opinion that continuous products importation into Nigeria is not the best way to sustain the country’s energy efficiency. They hinged their reason on the fact that Nigeria’s in-country output is at a low ebb, adding that resumption of importation will take Nigeria back to the dark days of crazy importation and subsidy claims.
They said the Dangote Refinery represented a salutary experiment on sufficient in-country output and macro-economic growth. They emphasised the need for groups to emulate Dangote Refinery and construct more refineries that would take Nigeria out of importation conundrum.
The Chief Executive Officer of the Centre for Promotion of Private Enterprises, Dr. Muda Yussuf said that Nigeria should promote its indigenous companies through proactive policies. According to him, such support should trickle down to the Dangote Refinery in order to avoid it being swallowed by sharks in the oil and gas industry. He maintained that the growth of the Dangote Refinery would improve Nigeria’s economy through job opportunities, backward integration and increased economic prospects in the country.
Increased support for indigenous refineries
An energy expert, Kunle Olubiyo also emphasised the need for increased support for indigenous refineries like Dangote and others. He said: ‘We cannot afford to be importing poverty and exporting jobs meant for Nigerian youths and able-bodied men and women abroad.
‘It is particularly worrisome that the Nigerian petroleum industry has attained areas of comparative advantages in refineries and petroleum chemical industries. Apart from job creation, wealth creation, sustainable growth expansion and development, Nigeria cannot be reduced to a dumping ground and allowed to become another Venezuela with all the attendant social vices.
‘As said repeatedly, what we need is to encourage Mangal Petroleum, BUA Petroleum, PENGASSAN Petroleum Inc, NUPENG (Nigeria Union of Petroleum and Natural Gas Workers), DAPMAN Group Petroleum, IPMAN Group Petroleum and others to join the frail.
‘They could be assisted to raise $20 billion each to set up their own refineries and petroleum chemical industries to give Dangote Refinery the much desired market competition that would be in the long run to the benefit of the demand and supply side of the Nigerian energy sector. Domestic gas and crude oil should not be exported now that we have local refineries’.
Competition, regulatory vigilance
A petroleum economist, Prof. Wunmi Iledare said single dominant supplier setting the pace in a highly concentrated market demanded immediate and uncompromising vigilance. He tasked regulators to ensure that this price reduction is not merely a strategic move that weakens independent marketers or consolidates market power, adding that Nigerians deserve genuine competition, not price leadership disguised as benevolence.
He emphasised the need for downstream and competition regulators to act decisively – monitor allocation practices, enforce transparency and protect smaller market players whose survival keeps the sector fair and balanced.
He added: ‘This price cut is positive, but without rigorous oversight, it risks reinforcing the very dominance that undermines long-term affordability and market stability. Now is the time for regulators to stand firm, stay alert and defend competition in Nigeria’s downstream sector’.
Endless battles
A public affairs analyst, Zayyad I. Muhammad believes the battle between Dangote and oil importers will not cease so soon. He noted that the new chief executives would not ban the importation of petroleum products by the NNPC Limited or other marketers outright because there is no law to back them, stressing that they are likely to engage Dangote cautiously to avoid the fate that befell Ahmed and Komolafe, which is not a good thing for any regulator in any industry.
He added: ‘If Dangote truly seeks full market patronage, pricing is key. His products must match or beat the cost of imported petroleum products. Marketers operate on a simple philosophy: buy good, sell good. If Dangote Refinery’s prices and processes are competitive or superior to imported products, no marketer would endure the challenges of sourcing foreign exchange, freight costs and time delays when a cheaper and readily available alternative exists at their doorstep’.
Nigerians are awaiting the victor between Dangote, with a huge financial chest desirous of leading the pack in private domestic refinery, and the importers, whose aim is to shore up product consumption at differential prices under a deregulated market.
