The Federal Government is set to introduce stricter competition rules in Nigeria’s midstream and downstream petroleum industry as regulators move to tackle price fixing, market allocation, abuse of dominance and discriminatory access to critical infrastructure.
The proposed Midstream and Downstream Petroleum Prevention of Anti-Competitive Practices and Behaviour Regulations, 2026, by the Nigerian Midstream and Downstream Petroleum Regulatory Authority, will establish detailed rules governing competition among operators in the sector.
The draft regulations will cover areas including petroleum pricing, pipelines, terminals, storage facilities, commercial agreements, digital platforms and the sharing of sensitive market information.
However, stakeholders at a consultation forum in Abuja on Tuesday raised concerns about some provisions, particularly those relating to long-term commercial contracts, arguing that the capital-intensive nature of the petroleum industry requires investors to have sufficient time to recover their investments.
The NMDPRA had first released the proposed regulations for public consultation on August 6, inviting licensees, permit holders and other stakeholders to submit their views within 21 days.
The consultation was conducted in line with Section 216(1) of the Petroleum Industry Act 2021, which requires the authority to consult relevant stakeholders before regulations are finalised.
The move followed concerns within the downstream market over alleged coordinated pricing by some petroleum importers.
Independent petroleum marketers had in July alleged that some major importers were selling imported Premium Motor Spirit at prices above those of the Dangote Petroleum Refinery.
Speaking at Tuesday’s consultation, the NMDPRA Chief Executive, Rabiu Umar, said the proposed framework was aimed at creating a transparent and efficient market while protecting consumers and investors.
Umar said the rules would prevent anti-competitive conduct, address abuse of market dominance and ensure fair access to essential petroleum infrastructure.
He said, “The proposed regulations are intended to strengthen the midstream and downstream petroleum sector by preventing anti-competitive practices, addressing abuse of dominance, promoting fair and non-discriminatory access in essential infrastructure, and also enhancing transparency and market efficiency.”
The NMDPRA boss urged stakeholders to scrutinise the proposed provisions and identify areas requiring clarification or adjustment before the regulations are finalised.
According to the authority’s Legal Adviser, Joseph Tolorunse, the draft contains 138 regulations divided into 23 parts.
Tolorunse said the proposed framework would go beyond traditional restrictions on price fixing to address infrastructure access, dominant market positions, vertical integration, mergers, digital markets, enforcement, penalties and cooperation among regulators.
He said, “The Midstream and Downstream Petroleum Prevention of Anticompetitive Practices and Behaviour Regulations, 2026 is a competition-law framework for Nigeria’s midstream and downstream petroleum industry.
“It contains 138 Regulations across 23 Parts, dealing not merely with price fixing, but also infrastructure access, dominance, vertical integration, mergers, digital markets, enforcement, penalties, compliance and inter-agency coordination.”
Under the proposed regulations, petroleum companies would be prohibited from coordinating pump prices, ex-depot prices, profit margins, discounts, freight charges, supply volumes, territories, customers or tender submissions.
The rules would also apply to informal or tacit arrangements, meaning companies could face regulatory action even where there is no written agreement establishing anti-competitive conduct.
Owners and operators of essential infrastructure, including pipelines, storage terminals, jetties, bulk-loading facilities and depots, would also be required to provide qualified third parties with access on transparent and non-discriminatory terms.
Such access would be based on legitimate considerations, including technical requirements, safety standards and creditworthiness.
The proposed framework would further require operators to publish applicable tariffs, fees and general service conditions, while prohibiting undisclosed charges, secret discounts and preferential arrangements that alter established access terms.
The draft also proposes regulatory scrutiny of exclusive supply arrangements, long-term contracts, take-or-pay agreements, tying and bundling arrangements, loyalty rebates, minimum-volume commitments, resale price maintenance and franchise restrictions where they could significantly restrict competition.
Tolorunse clarified that holding a dominant position in the market would not, in itself, constitute an offence, but the abuse of such dominance could attract regulatory action.
The regulations would also introduce competition reviews for mergers, acquisitions, changes in control and major joint ventures. The authority would consider factors such as market concentration, barriers to entry, risks of excluding competitors, control of essential infrastructure, consumer welfare and innovation.
Digital markets would also come under scrutiny, with provisions addressing dominant digital platforms, algorithm-driven pricing, commercially sensitive information and the use of consumer data.
The NMDPRA is also seeking closer cooperation with the Federal Competition and Consumer Protection Commission to strengthen competition enforcement in the petroleum industry.
Umar disclosed that both agencies had recently signed a Memorandum of Understanding to improve regulatory coordination.
He said, “Our mandates are not necessarily conflicting. Our mandates are complementary. And as a result of that, we have signed an MOU with the FCCPC to make sure that we strengthen the regulatory environment as regards to the petroleum midstream and downstream sector in the country.”
The two agencies signed the agreement on September 10, with the arrangement expected to facilitate information sharing, market intelligence and coordinated enforcement.
If approved, the proposed regulations will expand the NMDPRA’s focus beyond technical and licensing oversight to include closer monitoring of how petroleum companies exercise market power.
Operators would consequently be required to factor competition compliance into decisions involving pricing, infrastructure access, commercial contracts, mergers, joint ventures and the sharing of market information.
