Human rights lawyer, Femi Falana, SAN, has criticized the Nigerian National Petroleum Company Limited (NNPCL) for setting the price of Premium Motor Spirit (PMS) from the Dangote Refinery following the deregulation of the petroleum sector, calling the action illegal and a violation of the Petroleum Industry Act (PIA).
In a statement issued on Tuesday, Falana argued that the NNPCL’s decision contravenes Section 205 of the PIA, which stipulates that the prices of petroleum products must be determined by market forces.
“On September 5, 2024, the NNPCL explained that foreign exchange (forex) illiquidity had been a significant factor influencing the fluctuation in prices of PMS governed by unrestrained market forces, as provided for in the PIA,” Falana noted, referencing a statement made by Adedapo Segun, the Executive Vice President of Downstream NNPC Ltd.
However, Falana pointed out that despite the NNPCL’s position on forex challenges and the role of market forces, the company went ahead to fix the price of petrol produced at the Dangote Refinery.
“Contrary to the well-publicized statement, the NNPCL has fixed the price of PMS produced by the Dangote Refinery and Petrochemical Company Limited,” Falana stated. “The action of the NNPCL is a violent contravention of Section 205 of the PIA, which stipulates that the prices of petroleum products shall be determined by market forces.
“Furthermore, since the petrol sold by Dangote is not imported into the country but produced at the Lekki Economic Free Trade Zone, the NNPCL cannot justify the sale of petrol at N950 per litre without freight cost, lightering cost, jetty depot fees, storage fees, foreign exchange costs, NPA charges: NIMASA charges, Customs duties etc.”
The controversy follows the commencement of petrol lifting by the NNPCL from the Dangote Refinery, with the company announcing that PMS would sell for N950 per litre in Lagos and its environs, and above N1,000 per litre in other states, such as Borno.
