Legal and energy experts have raised an alarm over the ongoing impasse between Dangote Petroleum Refinery and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), saying the dispute transcends a mere commercial disagreement and touches on Nigeria’s fundamental approach to managing its hydrocarbon resources.
In a joint statement, Collins Okeke, Partner & Head of Government Affairs, and Dr. Olisa Agbakoba SAN, Senior Partner at Olisa Agbakoba Legal, said the row strikes at “the heart of a fundamental development question: the sovereignty of Nigeria’s governance process over its hydrocarbon resources.”
The experts noted the paradox of Nigeria hosting a $20 billion refinery, one of the world’s largest, yet still importing petroleum products.
The statement reads, “Nigeria now has a $20 billion refinery, one of the world’s largest, yet we continue importing petroleum products.
“A private investor has built the refining capacity our nation desperately needs, but faces systematic undermining from the very regulatory authority whose mandate is to support such investments.”
They argued that “when government policy actively frustrates transformative local investment, we must question whether our economic strategy serves national interest or perpetuates dependency.”
The dispute, they said, is about local refining, poverty alleviation, employment and industrial development, all central to how the nation governs its most valuable resource.
Okeke and Agbakoba described the conflict as emblematic of two “fundamentally different approaches to petroleum governance.”
“Nigeria currently operates under ‘Contract Oil’: a system where petroleum is treated merely as a commodity for extraction and export,” their statement said. Under this model, they argued, value addition and job creation are externalised to foreign entities.
“We export raw crude only to import refined products at premium prices, perpetuating dependency rather than fostering development,” they added.
By contrast, Saudi Arabia’s model of “Development Oil” was cited as an example of comprehensive national transformation. “The Kingdom does not permit any operation that undermines its local capacity,” the statement said, noting that Saudi Arabia has built world‑class refineries, a large maritime fleet and downstream infrastructure.
“Nigeria operates with no such vessels despite being Africa’s largest oil producer,” the experts added.
The statement referenced Section 44(3) of the Nigerian Constitution, which mandates that oil and gas resources shall vest in the Government of the Federation and shall be managed for the welfare and security of Nigerian citizens.
“When regulatory actions frustrate investments that create local capacity, generate employment, and reduce import dependency, they violate constitutional obligation,” the experts said.
They pointed to the ongoing situation, in which a domestic refinery struggles to secure crude feedstock while import licences continue to be issued as a “fundamental failure” of constitutional responsibility.
The statement stressed that the dispute is not just about one refinery or one company, but about Nigeria’s choice between continuing a “failed Contract Oil approach” that has contributed to seven decades of the resource curse, or embracing Development Oil principles that align resource management with constitutional obligations and national development imperatives.
“This is a defining moment between sovereignty and dependency, between development and extractive stagnation, between constitutional compliance and commercial expediency,” the experts said.
They urged all stakeholders to recognise the profound implications of the dispute and work toward a resolution that serves Nigeria’s constitutional obligations, development needs and long‑term national interest.