Petroleum Sector: NMDPRA Moves to Check Monopolies, Boost Regulatory Certainty
CHIGOZIE AMADI
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has said its proposed Midstream and Downstream Petroleum Prevention of Anti-Competitive Practices and Behaviour Regulations will fundamentally reshape competition in Nigeria’s petroleum industry by moving beyond licensing and technical oversight to actively regulating how market power is exercised.
Providing an overview of the proposed framework during a stakeholders’ consultation in Abuja on Tuesday, the Authority Secretary and Legal Adviser, Dr. Joseph Tolorunse, said the regulations were developed to translate the competition provisions of the Petroleum Industry Act (PIA), 2021 into detailed and enforceable rules for operators in the midstream and downstream petroleum sectors.
Tolorunse explained that the proposed framework would tackle anti-competitive conduct, guarantee open access to pipelines, terminals, storage facilities and other essential infrastructure, promote price and tariff transparency, prevent collusion among competitors, regulate dominant firms and vertically integrated operators, oversee mergers and acquisitions, changes in ownership, as well as address emerging concerns surrounding digital markets, data and artificial intelligence.
According to him, the regulations are intended to establish a level playing field by preventing monopolistic practices and abuse of market dominance, protecting consumers from collusion and market manipulation, ensuring fair and non-discriminatory access to critical infrastructure, improving transparency in pricing, market capacity and information, attracting investment and aligning Nigeria’s petroleum competition regime with global best practices.
He added that the proposed framework represents a significant shift from a regulatory system focused mainly on licensing and technical operations to one that places competition protection at the centre of petroleum regulation.
“In practical terms, the regulation transforms competition protection into a core component of petroleum regulation. Rather than leaving competition matters solely to general competition law, the regulations address sector-specific issues,” Tolorunse said.
He maintained that deregulation or market liberalisation alone could not deliver genuine competition where a single operator controls essential pipelines, storage facilities, terminals, wholesale supply, distribution networks or critical market information.
According to him, the regulations are designed to address the economic architecture of the market by determining who has access to petroleum infrastructure, under what conditions, at what cost, with what level of information and under which competitive safeguards.
Tolorunse further stated that the framework would considerably strengthen the Authority’s powers to intervene in cases involving infrastructure access, capacity allocation, market foreclosure and abuse of dominance.
He, however, stressed the importance of maintaining regulatory certainty, particularly in view of the interface between NMDPRA’s responsibilities under the Petroleum Industry Act and the competition oversight functions of the Federal Competition and Consumer Protection Commission (FCCPC).
The legal adviser disclosed that NMDPRA recently signed a Memorandum of Understanding with the FCCPC to deepen regulatory collaboration in the country’s midstream and downstream petroleum industry.
“Our mandates are not conflicting; they are complementary. We signed the MoU with the FCCPC to strengthen the regulatory environment for fair competition in the petroleum midstream and downstream sector,” he said.
Tolorunse noted that the draft regulations expressly recognise concurrent jurisdiction between both agencies, allowing for coordinated oversight of competition and consumer protection matters.
He explained that merger transactions, in particular, would involve cooperation between NMDPRA and FCCPC through information sharing, coordinated or parallel reviews, harmonised timelines, remedies and compliance requirements.
He nevertheless cautioned that provisions relating to concurrent jurisdiction, merger approvals, preliminary decisions and enforcement must be carefully reviewed to prevent duplication of responsibilities, jurisdictional disputes and regulatory uncertainty.
“We want regulatory certainty as a matter of law. The final regulations must not inadvertently create jurisdictional conflicts, duplication or uncertainty,” he stated.
Earlier, the Authority Chief Executive of NMDPRA, Rabiu Umar, said the proposed regulations were developed to strengthen competition within the petroleum industry by eliminating anti-competitive practices, curbing abuse of market dominance and preventing discriminatory access to critical infrastructure.
He explained that the proposed Midstream and Downstream Petroleum Prevention of Anti-Competitive Practices and Behaviour Regulations establish a sector-specific competition framework consisting of 138 regulations across 23 parts, covering the entire midstream and downstream petroleum value chain.
Speaking during the stakeholders’ consultation, Umar said the framework is intended to promote fair and non-discriminatory access to essential infrastructure, improve transparency and enhance market efficiency.
According to him, the consultation provides stakeholders with an opportunity to make practical contributions before the regulations are finalised.
“This is consultation in the truest sense. We are here to listen, learn and improve the draft where necessary,” he said.
The Authority Chief Executive explained that the regulations cover pipeline transportation, storage facilities, terminals, wholesale petroleum liquids and gas, retail fuel distribution, petrochemicals and other related commercial activities.
He added that the provisions would apply to licensees, permit holders, authorisation holders, affiliates and all persons engaged in commercial activities within the sector, including industry associations involved in competition.
Umar urged stakeholders to carefully examine the draft regulations, identify provisions requiring clarification or refinement and propose practical alternatives capable of achieving the intended regulatory objectives.
He said the Authority particularly welcomes views on the clarity, practicality and likely impact of the regulations, noting that effective regulation should provide certainty, encourage investment and innovation, promote efficient markets and preserve the integrity of Nigeria’s petroleum industry.
The stakeholder consultation is expected to shape the review and possible refinement of the draft regulations before they are finalised.
