The regulatory dispute between Dangote Petroleum Refinery and the Nigerian Midstream and Downstream Petroleum Regulatory Authority has escalated to the Federal High Court in Lagos, with NMDPRA defending its decision to suspend propane loading and truck-out operations and the refinery accusing the regulator of abusing its powers.
The confrontation came to a head on Wednesday when NMDPRA asked the court to discharge an interim order restraining it from enforcing the suspension. Dangote, however, maintained that NMDPRA officials had inspected and certified the propane before it left the refinery and questioned the refinery’s liability for products transported by independent off-takers.
On August 31, the court restrained NMDPRA, its officers, agents and representatives from entering, sealing, shutting down, restricting access to, obstructing, suspending, disrupting, inspecting, supervising or sanctioning the refinery’s operations pending the hearing and determination of the substantive application.
NMDPRA, through its counsel, Matthew Burkaa, challenged the order, alleging that Dangote obtained it through misrepresentation and suppression of material facts. The regulator also questioned Justice Akintayo Aluko’s jurisdiction to grant the order, arguing that the refinery had not filed the required motion on notice when its ex-parte application was heard.
NMDPRA said its decision to suspend propane loading and truck-out operations followed an investigation into alleged diversion of propane and concerns over the quality of LPG blends at three plants. It said laboratory tests on samples from Selai, Tewa and Ameego Pago showed propane content above 50 per cent, against the industry requirement that propane should not exceed 20 per cent of an LPG blend.
According to the regulator, the three plants identified Sublime Oil and Gas Limited, an off-taker from Dangote Refinery, as their source of propane. NMDPRA subsequently commenced a wider reconciliation and material-balance exercise involving propane-producing facilities and LPG-blending plants, while alleging that its officials were denied access when they attempted to inspect propane-loading operations and records at Dangote Refinery on August 24.
The regulator also alleged discrepancies in truck-out records. It said Sublime Oil and Gas lifted 25 trucks of propane on August 20 and 22 for delivery to Navgas/Agasco, but Navgas confirmed receiving only six, leaving 19 trucks unaccounted for. NMDPRA further alleged that another off-taker loaded 52 trucks between May and August for delivery to Navgas, but Navgas confirmed that none of the consignments were received.
NMDPRA told the court that the alleged diversion to unauthorised and unlicensed customers raised public health and safety concerns because the propane was allegedly being used for LPG blending outside approved standards. It further claimed that propane produced by Dangote and other gas-processing facilities had a vapour pressure of about 13 bar, compared with the maximum seven-bar pressure required for the standard propane-butane LPG mixture.
Dangote Group spokesman, Anthony Chiejina, rejected the regulator’s position, insisting that NMDPRA officials at the refinery had inspected and certified the propane before it was collected. “We have NMDPRA staff there in the refinery. They inspected and certified the product as okay,” he said. Chiejina also accused the regulator of abusing its powers, saying, “You went to the plant to seal it and later left the plant. For me, that is an absolute abuse of power by NMDPRA.”
At Wednesday’s proceedings, Dangote’s counsel, Wale Akoni, SAN, sought an adjournment to respond to NMDPRA’s counter-affidavit, saying he had only been served with the document in court. Burkaa did not oppose the request but stressed the urgency of the safety concerns raised by the regulator. Justice Aluko said he could not fix a fresh date because his tenure as vacation judge would end on Friday and directed that the case file be returned to the registry for assignment to the regular court. He subsequently extended the August 31 interim order restraining NMDPRA from interfering with the refinery’s operations until the hearing and determination of the motion on notice or further directive of the court.