ABUJA, Nigeria (AP) — Nigerian lawmakers on Monday launched an investigation into the alleged importation of contaminated fuel into the country, part of efforts to resolve issues causing a conflict between an oil refinery owned by Nigeria’s richest man Africa Aliko Dangote and the industry regulator.
A legislative committee tasked with carrying out the investigation is also looking into allegations of “indiscriminate issuance of licenses and the alleged unavailability of international standards laboratories” blamed for such contaminated products, its chairman, Ikenga Ugochinyere, said in the capital, Abuja.
The commission called on parties in Nigeria’s oil sector to “reduce tensions” that have been deepened in recent weeks by the regulator’s accusations that Dangote was seeking a monopoly in the market and that his refinery’s products are of low standard.
The 650 thousand barrels per day refinery in the economic center of Lagos is the largest in Africa and was considered by authorities as a game changer that would end the oil-rich country’s dependence on imported gasoline.
However, the $19 billion facility got off to a slow start, despite opening more than a year ago. Had to acquire crude oil from other countries after failing to secure supplies in Nigeria, whose capacity as one of Africa’s largest oil producers has been undermined by oil theft and chronic corruption.
A senior executive at the refinery also accused international oil companies in Nigeria of conspiring to bring the refinery to failure. “Either they are deliberately asking for a ridiculous premium or they are simply claiming that crude oil is not available,” Devakumar Edwin, vice-president of Dangote Industries, said of the companies.
The Dangote refinery’s challenges worsened last week when Nigeria’s Midstream and Downstream Petroleum Regulatory Authority said the quality of its products, along with that of other local refineries, was “more inferior” compared to that of imported products.
“Dangote is asking us to suspend or stop the import of all petroleum products… and this is not good for the market due to the monopoly,” said Farouk Ahmed, chief executive of the regulatory agency.
Dangote denied both allegations and invited lawmakers to inspect the factory where his product was tested. He said he has not received any incentives from the Nigerian government regarding the refinery. He also said he was canceling plans to invest in Nigeria’s steel industry.
It is unclear what the source of the conflict is between Nigerian authorities and Dangote, whose companies also dominate markets such as cement and flour. The dispute began after last year’s presidential elections, won by President Bola Tinubu, who replaced Muhammadu Buhari, a known ally of Dangote, who had completed his term as president.
Analysts say such a dispute could send the wrong signal at a time when the country is seeking to increase foreign investment and stabilize its struggling economy.
Such allegations about low-quality products coming from the refinery seem “strange,” especially when presented without evidence and in the absence of consumer complaints, said Nigerian economist Bismarck Rewane, echoing concerns that the allegations are just a sign of deeper issues.
