The Nigerian National Petroleum Company Limited (NNPCL) says it is renegotiating a new naira-for-crude deal with the Dangote Petroleum Refinery, ahead of the March 21, 2025 end of the subsisting deal.
Chief Corporate Communications Officer, NNPCL, Olufemi Soneye, said in a statement that the initial deal was for six months, and that discussions for the renewal of the agreement are currently ongoing, with the aim of establishing a new contract.
He also stated that under the deal initiated in October 2024, the 650,000-capacity refinery has received 48 million barrels to refine for petroleum products, while a total of 84 million barrels had been supplied to the refinery since it commenced operations in 2023.
Soneye, however, clarified that the deal was subject to availability.
The national oil firm further reaffirmed its commitment to supplying crude oil for local refining based on mutually agreed terms and conditions.
Chairman of the Technical Sub-Committee on the naira-for-crude deal, Zacch Adedeji, also reaffirmed the government’s stance that the deal had not be suspended.
He said there is substantial evidence supporting the policy as the correct approach and affirmed that it will continue to contribute positively to the nation’s economy.
“The policy framework enabling the sale of crude oil in naira for domestic refining remains in force. The initiative was designed to ensure supply stability and optimise the utilisation of local refining capacity. There has been no decision at the policy level to discontinue this approach, nor is it being considered. After implementing the policy for some months, evidence abounds that it is the right way to go, and it will continue to help the economy.
“The framework for domestic crude transactions is designed to promote a competitive and efficient pricing environment,” Adedeji, who is also chairman of the Federal Inland Revenue Service (FIRS) said in an e-signed statement.
He also revealed that local refineries have not been excluded from domestic crude supply and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is actively ensuring compliance with the Domestic Crude Oil Obligations provisions of the Petroleum Industry Act.
“The engagement process for crude oil supply to domestic refineries therefore remains in place by structured agreements, balancing factors such as availability, demand, and market conditions. There is no exclusion of local refineries from access to domestic crude oil. The Nigerian Upstream Petroleum Regulatory Commission is actively ensuring compliance with the Domestic Crude Oil Obligations provisions of the Petroleum Industry Act.
“We remain committed to ensuring the efficient execution of this initiative in line with its core objectives – enhancing local refining, reducing foreign exchange exposure, and stabilising the domestic fuel supply,” he added.
Speaking in similar vein, Publicity Secretary of the Crude Oil Refinery-Owners Association of Nigeria, Eche Idoko, stated that the renewal was part of the original plan, emphasising that there have been no changes to the initial discussions.
However, he urged the government to honour its commitment to meeting the 27,000 barrels per day demand from modular refineries, stressing the importance of fulfilling this promise for the continued success of the industry.
