Stakeholders Advocate Fair Competitiveness In Nigeria’s Petroleum Downstream Sector
By Kelvin Alohan
An oil and gas governance consultant, Ademola Adigun, has urged the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to ensure fair competitiveness in the petroleum downstream sector.
Adigun stated this during a media roundtable on Nigeria’s Petroleum Downstream Sector, organised by Extractive360 on Wednesday in Abuja.
He added that when the sector is driven by fair competition, it makes the market healthy, investment friendly and consumers benefits.
Adigun said, “the petroleum downstream market should be driven by competition, and the competition must be fair, well regulated by its regulators and provide the benefits to the consumers.
“When there’s a competition in any market, the consumers benefit, though its been argued in the downstream sector that it’s Dangote Refinery versus others. But recall that Dangote Refinery is a wondrous investment, a state of the art refinery and a pride of the nation.
“Nigeria was a joke of nations just three years ago, that Nigeria exports what it doesn’t have and imports what it has, but Dangote Refinery has changed that narrative by now exporting refined petroleum products to other countries.
“The downstream sector doesn’t have enough competition yet for refining products, that’s why we are saying that we should continue to import not because there’s no sufficient potential in the market, but because there’s no alternative in the market. And we should understand that for a product as sensitive as petrol, we don’t need one source of supply.”
Adigun stated further that the NMDPRA is in a delicate position in terms of regulation, adding that Nigerians are the victims of poor regulation in the petroleum downstream sector.
“The NMDPRA needs to step up their game, though they’re in a delicate position because whenever they attempt to do their jobs properly, some people accuse them of being biased, and when they fail to act, they’re also accused of favouring certain players in the sector.
“Frequent price adjustment impacts the market negatively, and Nigerians are the victims of poor regulation in the petroleum downstream sector,” he said.
Meanwhile, in her presentation titled; “Competitiveness in The Downstream Sector and What the law says”, a legal expert, Olasubomi Chuku, said that a competitive market is accessible, devoid of monopoly and driven by free market forces.
Chuku said, “a competitive market is an open, free market with multiple participants who operate independently and contend for their share of the market with regulatory neutrality and consumer protection.
Olasubomi Chuku, Legal Expert
“Population growth and urbanisation, deregulation, innovation, and globalisation and foreign investments are all drivers of competitive market in the downstream sector.”
She listed the regulatory framework to promote competitiveness in the petroleum downstream sector as: Petroleum Industry Act 2021; Federal Competition and Consumer Protection Act 2018; Global Best Practices in the Downstream Sector.
Chuku said, “Section 8(1)(d) of the PIA says ‘NMDPRA shall ensure fair pricing and competition in the midstream and downstream petroleum operations.’ While Section 205(2) of the PIA states that ‘No person shall fix prices or restrict the supply of petroleum products except as provided under the Act.’
“Section 70 of the FCCP Act states that ‘Abuse of dominant position includes excessive pricing, limited production or establishing unequal market participation conditions.’ While Section 120-126 of the FCCP Act states that ‘FCCPC is mandated to monitor and investigate anti-competitive practices in any sector’.”
Earlier, the Executive Director of Extractive360, Juliet Ukanwosu, in her welcome remarks said that the Nigerian petroleum downstream sector is navigating a turbulent phase marked by a combination of opportunities and pressures.
Ukanwosu said, “Since the removal of fuel subsidies, market forces have largely determined pump prices, triggering intense competition — often described as a price war — among operators. This has led to fluctuating product prices, sometimes creating uncertainty for both businesses and consumers.
“In addition, challenges such as high operating costs, irregular foreign exchange rates, import dependency for refined products, and infrastructural bottlenecks have added strain to the sector.
“On the positive side, the liberalization policy has opened space for more private sector participation, investment in storage and distribution infrastructure, and conversations around refining capacity expansion.
“Overall, the sector is in a state of adjustment — seeking stability and competitiveness amid shifting regulations, volatile market dynamics, and evolving public expectations.”
Extractive360.com reports that the NMDPRA is incharge of Downstream regulation which focuses on issues such as product quality, pricing, consumer protection, environmental compliance, and market competition. It plays a pivotal role in maintaining the reliability and affordability of energy sources while safeguarding public health and environmental sustainability.
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