Dangote Refinery Asks Court To Void NNPCL, Matrix, 4 Others’ Import Licences

The Dangote Petroleum Refinery and Petrochemicals FZE has told a Federal High Court in Abuja to void import licences issued to the Nigeria National Petroleum Corporation Limited (NNPCL), Matrix Petroleum Services Limited, A. A. Rano Limited, and four other companies.

The plaintiff contends that the defendants’ import licences should be voided because those companies are already producing the imported petroleum products without shortfalls.

In suit number FHC/ABJ/CS/1324/2024, Dangote Refinery is also seeking N100 billion in damages against the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) for allegedly continuing to issue import licences to NNPCL, Matrix, and other companies for the importation of petroleum products such as Automotive Gas Oil (AGO) and Jet Fuel (aviation turbine fuel) into Nigeria “despite the production of AGO and Jet-A1 that exceeds the current daily consumption of petroleum products in Nigeria by the Dangote Refinery.”

Meanwhile, the Dangote Group has said no fresh cases have been filed against the Nigerian National Petroleum Corporation Limited (NNPC) or other companies.

The chief branding and communications officer, Anthony Chiejina, in a statement, yesterday, said “this is an old issue that started in June and culminated in a matter being filed on September 6, 2024.

Chiejina said currently, the parties are in discussion since President Bola Ahmed Tinubu’s directive on Crude Oil and Refined products sales in Naira Initiative, which was approved by the Federal Executive Council (FEC).

“We have made tremendous progress in that regard and events have overtaken this development.

“No party has been served with court processes and there is no intention of doing so. We have agreed to put a halt to the proceedings.

“It is important to stress that no orders have been made and there are no adverse effects on any party. We understand that once the matter comes up in January 2025, we would be in a position to formally withdraw the matter in court,” Chiejina stated.

NMDPRA, Aym Shafa Limited, T. Time Petroleum Limited, and 2015 Petroleum Limited are other defendants in the suit.

The plaintiff, in its originating summons dated September 6, 2024, through its lawyer, Ogwu James Onoja, SAN, asked the court to declare that NMDPRA is allegedly in violation of Sections 317(8) and (9) of the Petroleum Industry Act by issuing licences for the importation of petroleum products.

He stated that such licences should only be issued when a petroleum product shortfall occurs.

He also urged the court to declare that NMDPRA violates its statutory responsibilities under the Petroleum Industry Act (PIA) for not encouraging local refineries such as Dangote Refinery.

In an affidavit deposed by Ahmed Hashem, the group general manager of government and strategic relations at Dangote Refinery, he submitted that the import licences granted to other companies by NMDPRA for the importation of AGO and Jet-A1 are crippling the plaintiff’s business, to which it has committed substantial financial resource in billions of US dollars.

He asserted that the plaintiff’s products are primarily left unpatronised due to the alleged actions of NMDPRA.

He further stated that NMDPRA had threatened to impose and demand a 0.5% levy on the plaintiff on wholesales and off-takers, as well as another 0.5% levy on wholesales to the Midstream and Downstream Gas Infrastructure Fund (MDGIF) via a letter dated June 10, 2024, contrary to statutory provisions that limit the implementation of levies on transactions within Free Zones (FZ).

According to him, the foundational purpose of establishing Free Zones is to foster competition, attract foreign investment, and create tax havens.

He further alleged that there is a grand conspiracy and concerted effort by International Oil Companies (IOCs) and interests, in conjunction with the defendants, who are unhappy that Nigeria has an indigenous refinery ready to solve the lingering energy crisis and save the economy.

“The intervention of the Honourable Court has become necessary to stem the incessant violation of statutory provisions by the 1st Defendant in favour of other entities such as the 2nd to 7th defendants,” the plaintiff stated.

The refinery’s legal team stated that the plaintiff is greatly distressed, and its investments risk being jeopardised unless the court intervenes.

He sought an injunction restraining the 1st Defendant from further issuing and/or renewing import licences to the 2nd to 7th defendants or other companies for the purpose of importing petroleum products.

In addition to a restraining order against the import licences of the affected companies, the plaintiff sought “general damages in the sum of N100 billion against the 1st Defendant (NMDPRA) and an order of court directing the 1st Defendant to seal off all tank farms, storage facilities, warehouses, and stations used by the defendants for the storage of all refined petroleum products imported into Nigeria.”

Other reliefs partly sought by the plaintiff are as follows:  a declaration that by the provisions of Section 8(1) of the Nigerian Export Processing Zone Act (NEPZA), Sections 23(h) and 55(1) of the Companies Income Tax Act (CIT Act), Paragraph 6 of the Second Schedule to the CIT Act, Regulation 54(2)(a)(i) of the Dangote Industries Free Zone Regulation 2020, and the Finance Act, the plaintiff, being an entity duly registered as a Free Zone Enterprise, is exempted from all federal, state, and local government taxes, levies, and other rates;

a declaration that it is against the NEPZA Act, CIT Act, Finance Act, and Dangote Industries Free Zone Regulation 2020, as well as legislative intent, for the 1st Defendant to impose or threaten to impose on the plaintiff an additional financial obligation of a 0.5% levy meant for off-takers of petroleum products directly and an additional 0.5% wholesale levy in favour of the Midstream Downstream Gas Infrastructure Fund (MDGIF).

He also sought an order of mandatory injunction directing the 1st Defendant to withdraw immediately all import licences issued to the 2nd-7th defendants and other companies other than the plaintiff and other local refineries to import refined petroleum products into Nigeria.

An order of injunction restraining the 1st Defendant from imposing and demanding a 0.5% levy meant for off-takers of petroleum products directly and an additional 0.5% wholesale levy in favour of MDGIF or any other levy or sum against the plaintiff.

At the resumed sitting before Justice Inyang Ekwo, George Ibrahim, SAN, counsel for the plaintiff, informed the judge that the case had developed as the parties are trying to settle.

“My lord, there is a development in this matter, which the lead counsel, James Onoja, SAN, has asked me to bring to the court’s attention. When we were trying to serve the originating summons on the defendants, they started discussing,” he said.

He requested an adjournment to give the parties the opportunity to reach a settlement.

He suggested the court adjourn for either a possible settlement report or a service report.

“Case adjourned to January 20, 2025, for the report,” Ekwo responded.

No Fresh Case Filed Against NNPC, Others– Dangote