Court orders NMDPRA to renew petrol import licences

The Federal High Court in Abuja has ordered the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to continue issuing, renewing and extending petroleum products import licences to Matrix Energy, AA Rano and AYM Shafa, subject to compliance with statutory and regulatory requirements.

Justice Inyang Ekwo, in a judgment delivered on Monday, held that the regulator’s refusal to regularly issue or renew the companies’ import licences was inconsistent with the Petroleum Industry Act (PIA).

The court ruled that NMDPRA must continue granting, issuing, extending, renewing or reissuing licences, permits and authorisations for midstream and downstream petroleum operations, particularly petroleum products importation, where the companies satisfy the applicable legal and regulatory conditions.

The judgment followed a suit filed by the three oil marketers in June after they challenged what they described as the regulator’s sporadic issuance and renewal of their petroleum products import licences.

The companies argued that the PIA does not prohibit petroleum products importation or prevent NMDPRA from granting licences to eligible operators.

Justice Ekwo also held that the authority’s exercise of regulatory powers in violation of the PIA and other relevant laws would be null and void.

The court further declared that Sections 31 and 32 of the PIA, read alongside Section 72 of the Federal Competition and Consumer Protection Act, require NMDPRA to promote competition in the midstream and downstream petroleum sectors and prevent abuse of dominant market positions and restrictive business practices.

The court, however, maintained that NMDPRA retains its regulatory powers to grant, modify, extend, renew, suspend, cancel or terminate licences and permits for midstream and downstream petroleum operations.

The ruling therefore does not remove the regulator’s discretion over licensing but requires that eligible operators be considered in accordance with the law.

The marketers had told the court that NMDPRA had, since July 2025, issued, extended or renewed their import licences only intermittently.

Sabiu Saidu Mahuta, Executive Director of AA Rano Nigeria Limited, said in an affidavit filed in support of the case that the regulator’s actions and inactions were contributing to market dominance and monopolisation in the downstream petroleum sector.

He said the three companies had collectively invested more than $20 billion in infrastructure, logistics and retail networks for their petroleum businesses.

The companies argued that continued petroleum imports alongside local refining would help sustain competition, discourage monopolistic practices and support efficient supply of petroleum products.

The judgment comes amid an intensifying legal and commercial dispute over the future of petrol imports as domestic refining capacity expands.

Dangote Refinery is separately challenging the continued issuance of petroleum products import licences, arguing that imports should only be allowed where domestic refineries cannot meet national demand.

The refinery recently filed a fresh N100 billion suit against the Attorney-General of the Federation at the Federal High Court in Lagos over the continued issuance of import licences, with Matrix Energy, AA Rano and AYM Shafa applying to join the case.

The Abuja ruling comes against the backdrop of declining reliance on imported petrol and increasing supplies from domestic refineries.

Recent NMDPRA data showed that average daily PMS receipts rose from 45.5 million litres in July to 50.5 million litres in August, representing an 11 per cent increase.

Domestic PMS receipts accounted for much of the increase, rising by 39 per cent from 25.8 million litres per day to 35.9 million litres per day, while petrol imports fell by 26 per cent from 19.7 million litres per day to 14.6 million litres per day.

Despite the decline in imports, NMDPRA approved petrol import permits covering about 830,000 metric tonnes for several companies for the fourth quarter of 2026 to guard against possible supply shortages.

The permits reportedly covered Matrix Energy, AA Rano, AYM Shafa, NIPCO, Pinnacle Oil and Bono Energy, with the approvals issued on September 18.

The Abuja judgment consequently adds a significant legal dimension to the ongoing debate over how Nigeria should balance growing domestic refining capacity with competition and continued access to imported petroleum products.