The Nigeria National Petroleum Company (NNPC) Ltd has said payment to fuel importers would be deferred for three months.
The company attributed the development to
falling crude revenues have forced NNPC Ltd to defer payments to fuel importers for 3 months.
Chief Executive Officer, NNPC Ltd, Mele Kyari disclosed this in an interview with Bloomberg on Monday.
He listed the importers the NNPC has deferred payments to as: Vitol, Total, Sahara Group, and Oando.
According to him, dwindling crude output has forced NNPC to defer payments to some local gasoline suppliers by at least three months.
He added that NNPC swaps crude with international traders, including Vitol Group and TotalEnergies SE, as well as domestic groups such as Sahara Group Ltd. and Oando Plc.
Kyari added that the deal involves a longer credit period but as oil production dropped to less than 1.2 million BPD, local importers have been asked to permit payment delays of at least 90 days.
He expressed optimism that a rebound in Nigeria’s crude production will allow the company to cover its deferred payment obligations and expect Nigeria to add 500,000 barrels a day to its output by the end of November, mainly by restarting activities on the Forcados export terminal and Trans-Niger pipeline.
“We will meet all the deliveries and still have surplus crude production for cash. They know we can pay otherwise they wouldn’t supply,” he said.
The CEO further stated that the new contract operates alongside the original “direct sale, direct purchase” deals, under which NNPC is expected to provide crude before traders deliver the fuel.
“Those local firms accepting deferred payments receive an additional premium per ton of gasoline, according to people familiar with the arrangements. So far, the companies involved in those new contracts are Sahara, Oando, MRS Oil, and Duke Oil, a subsidiary of NNPC” he further stated.
