The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has been accused of failing to enforce key provisions of the Petroleum Industry Act (PIA), particularly on sulphur limits, fuel quality standards, and regulatory frameworks guiding the oil market.
Speaking on Channels Television’s The Morning Brief on Monday, Kelvin Emmanuel, an Economist, alleged that the Authority’s negligence has created an uneven playing field for local refiners, allowing foreign traders to dump substandard products into the Nigerian market.
“The NMDPRA has failed to enforce the PIA on sulphur limits. It has also failed to provide a framework for regulating things like octane level, distillation level, cloud point for diesel, and flash point for diesel,” he stated. “You have unfair competition because traders are dumping products that fall below the regulatory standards and limits approved for the industry.”
He explained that the recent Federal Government directive approving a 15 per cent import duty on petrol aligns with Article 6 of the World Trade Organisation (WTO) charter on countervailing and anti-dumping measures, meant to protect domestic industries from harmful imports.
According to Emmanuel, “The ad valorem of 15 per cent import duty on petrol is in line with Article 6 of the WTO charter on what is called countervailing and anti-dumping, especially when it has been proven that the domestic product poses material harm to domestic industries.”
He noted that the NMDPRA does not operate standard ASTM labs and outsources product testing to third-party companies, leaving room for manipulation in determining fuel quality and prices.
“Because the certificate of quality determines the price, what you have is companies buying condensate in Eastern Europe, refining it, and sending it mostly to Lome,” he said.
Emmanuel highlighted that Togo now controls a major part of Nigeria’s energy security, with over 2 million metric tons (about 2.6 billion liters) of floating storage and offloading capacity being used for blending.
He emphasised that blending in Floating Storage and Offloading Units (FSOs) lacks the hydrotreating capacity to remove sulphur, leading to high-sulphur fuels entering the Nigerian market.
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He warned that such imports violate the Economic Community of West African States (ECOWAS) sulphur limit of 50 parts per million, and undermine Nigeria’s local refiners, who operate under stricter standards.
“The grade of products they bring into Nigeria should actually be below ₦500 per litre, but they’re pricing at import parity, which forces the hand of domestic refiners who adhere to the PIA standards,” he added.
Emmanuel said the new policy directive from the presidency is a corrective measure to compel marketers to comply with Section 317(7) of the PIA, which mandates the regulator to provide a backward integration plan for midstream refining or compel importers to source products from local refiners.
His comments come following President Bola Tinubu giving a go-ahead to a 15% import duty on diesel and premium motor spirits brought into the country, and are expected to promote stability in the downstream and oil sector and protect domestic refineries.
