PETROAN says Dangote’s allegations against NMDPRA’s CEO may discourage foreign investors

The Petroleum Products Retail Outlets Owners Association ofNigeria (PETROAN) says allegations made by Aliko Dangote, president of DangoteGroup, against the leadership of the Nigerian Midstream and DownstreamPetroleum Regulatory Authority (NMDPRA), can deter potential foreign investors. On Monday, Dangote alleged that Farouk Ahmed, NMDPRA’s chiefexecutive officer (CEO), “paid $5 million” to a Swiss secondary school for hischildren’s education, describing the act as “economic sabotage and corruption”. Releasing details of his allegations, in the newspaperadvert, Dangote listed the four children as Faisal Farouk, Farouk Jr., AshrafFarouk, and Farhana Farouk. In a statement on Tuesday, Billy Gillis-Harry, nationalpresident of PETROAN, said the action could erode confidence in Nigeria’sregulatory institutions. He, therefore, called on President Bola Tinubu to urgentlyintervene to resolve the ongoing dispute in the downstream petroleum sector. Gillis-Harry also called on the president to promotedialogue over confrontation, uphold the provisions of the Petroleum IndustryAct (PIA), ensure fair competition, and restore stability and confidence in thedownstream industry.He said ongoing allegations and verbal attacks “directed atthe leadership of the Nigerian Midstream and Downstream Petroleum RegulatoryAuthority (NMDPRA) by Aliko Dangote, president of Dangote Group, are capable ofdiscouraging potential foreign investors and eroding confidence in Nigeria’sregulatory institutions”. ‘PETROAN PASSES VOTE OF CONFIDENCE ON NMDPRA LEADERSHIP’ According to the statement, PETROAN, at its emergencyordinary national general meeting held on Monday, passed a vote of confidenceon the leadership of the NMDPRA under the leadership of Ahmed. PETROAN said the decision followed the reforms, strategicgovernance, and regulatory clarity introduced by the NMDPRA in the Nigeriandownstream petroleum sector. “Of serious concern are the negative public statements madeagainst Nigeria’s national refineries, suggesting that they are unattractivefor investment. PETROAN maintains that sound business ethics discourage runningdown another entity’s business, irrespective of competition,” the statementreads. “PETROAN strongly condemns the announcement or pronouncementof petroleum product prices by any individual, corporate body, or agency.” PETROAN said Nigeria’s four refineries are viable foracquisition and that the downstream petroleum sector remains business-friendlyand attractive to both local and foreign investors. Furthermore, the association said the unresolved issues“involving NUPENG and PENGASSAN in relation to Dangote refinery remain pendingand continue to compound the crisis in the downstream sector”. PETROAN warned that failure to promptly resolve the ongoingdisputes and tensions could lead to supply chain disruptions, artificial fuelshortages, job losses, declining investor confidence, regulatory uncertainty,and unhealthy price manipulation in the sector. The association further emphasised that only constructivenegotiation and fair commercial engagement are key to attracting importers tolocal refineries. “Such engagement must not be driven by compelling or brutalprice-ambushing strategies, which undermine market confidence and distort faircompetition,” PETROAN said. “PETROAN believes that the current dirty price war isalready causing collateral damage to all parties involved. Most of theaggressive price crashes appear designed to frustrate importers and are oftenexecuted below cost. “Consequently, all parties in the price war may be operatingat a loss in a bid to gain market dominance, a development PETROAN considersunsustainable and harmful to the long-term stability of the downstream sector.” The association also asked the Nigerian National PetroleumCompany (NNPC) Limited to hasten the process of engaging credibleprivate-sector partners for the rehabilitation, management, or co-ownership ofthe national refineries.

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