By Adewale Sanyaolu
The Director, Institute for Energy and Extractive Industry Law, Mr. Henry Adigun, has ruled out the possibility of Nigeria ending fuel imports in the near future.
Adigun stated this at a training organised for energy editors and correspondents in Lagos at the weekend.
The oil and gas expert explained that Section 317(9) of the Petroleum Industry Act (PIA) allows the regulator to grant import licenses to companies with active local refining licenses or a proven track record of international crude oil and petroleum products trading for product shortfalls.
This section, he said, empowers the regulator to address potential shortages by allowing authorized entities to import fuel.
“The crafters of the law had envisaged a situation whereby refineries in the country may experience a downtime due to maintenance or a mechanical fault that will affect its operations.
At such time, the regulator will enforce the clause as contained in section 317(9) to bridge the shortfall pending when the refinery comes back on stream.”
According to Adigun, Nigeria could only stop fuel importation when at least three to four refineries are working in the country.
“We cannot stop the importation of fuel now until we have about three to four functioning refineries. We cannot have our energy security in the hands of one person, that’s what the NMDPRA chief executive was trying to say sometime ago,” Adigun stated.
He added that the government should also consider other investors in the midstream, who may be affected by the sudden stoppage of importation.
The expert noted that depot owners were protected by the Petroleum Industry Act to import fuel, saying that right cannot be taken away from them by a fiat.
He noted that those importing fuel at the moment naturally patronise the Dangote refinery when the price is better than going outside the country to import fuel.
Adigun, however, cautioned that it was not feasible that the Dangote refinery would continue to crash petroleum products prices without corresponding market factors.
He argued that the cost of crude, whether supplied locally or in naira, would be priced according to the international benchmark.
He added that the recent reduction in petrol prices by Dangote Petroleum Refinery was due to the decline in global crude oil prices and the potential reintroduction of a “crude-for-naira” agreement.
It would be recalled that the price cut, announced by Dangote Refinery on April 10, reduced the ex-depot petrol price from N880 per litre to N865.
Adigun commended Dangote Refinery for its proactive decision, suggesting that the Federal Government’s stance on crude-for-naira deals might have contributed to the price reduction.
He further highlighted that the drop in crude oil prices has improved refining margins, making the local refinery’s operations more profitable.
In his presentation titled “Understanding Anticompetitive Practices in the Midstream and Downstream Petroleum Industry, energy policy analyst, Taiwo Ogunleye, explained that anti-competitive market practices and behavior in the midstream and downstream petroleum industry are activities performed by companies to undermine fair competition, negatively impacting market efficiency, prices, and consumer choices.
According to him, such practices may include price fixing, collusion, predatory pricing, market allocation, monopolisation or abuse of dominance, exclusive contracts, unfair restrictions in distribution and retail operations, refusals to supply or deal, indiscrimination in pricing or limiting infrastructure access to competitors.
The expert argued that the impacts of anticompetitive practices are especially severe in countries with developing regulatory institutions or in transitioning markets.
To address such practices, he said strict regulatory oversight and enforcement, transparent market access rules, and competitive pressure remain essential to minimize these serious consequences.