Naira crude sale yet to happen – Operators

The Dangote Petroleum Refinery and other domestic refineries have yet to start the purchase of crude oil in naira as directed by President Bola Tinubu.

It was that the $20bn plant and other local refineries in Nigeria had yet to start buying crude oil from the Nigerian National Petroleum Company Limited in naira as instructed by Tinubu last week.

The Crude Oil Refiners Association of Nigeria said letters have been written to NNPC by individual refiners requesting crude, but there has been no response yet.

The Federal Executive Council recently adopted a proposal by Tinubu to sell crude to the Dangote refinery and other upcoming refineries in naira.

FEC approved that the 450,000 barrels meant for domestic consumption be offered in naira to Nigerian refineries, using the Dangote refinery as a pilot. The exchange rate will be fixed for the duration of this transaction.

However, almost one week after the announcement, the refiners said they had not heard from the NNPC.

The Publicity Secretary of the Crude Oil Refiners Association of Nigeria, Eche Idoko, said the Nigerian Midstream and Downstream Petroleum Authority is expected to kickstart the process.

“We have not started buying crude from NNPC. Individual members have written to them (NNPC) already, and they have several requests from these refineries before them.

“Typically, we would expect our regulator, in this instance, the NMDPRA, to kick start the process by calling for a meeting of all parties to discuss the framework for such supply or have NNPC respond to the various letters to it by the refineries requesting for crude,” Idoko noted.

The CORAN spokesperson had earlier stated that the supply of crude oil to local refineries in naira would bring down the cost of petrol and strengthen the naira against the dollar.

Idoko commended Tinubu for listening to the voice of indigenous refiners but noted that an executive order should be issued on the new directive.

The crude oil refiners also sought a meeting with the economic team to work out a rate that would favour the Nigerian market.

“Yes, we will see a rebound in the pricing of fuel once the President’s order is implemented. Mind you, the pronouncement alone is not enough. It must be with a force of law, either by executive order or by incorporating it into a new guideline so that the crude producers will be bound to sell to us in naira,” Idoko stated.

Dangote refinery and other domestic refiners have been complaining about the difficulties associated with accessing crude oil for their plants. Recently, the management of Dangote Group insisted that the IOCs were still frustrating crude supply to the 650,000-capacity refinery.

In a statement, the group alleged that the IOCs insisted on selling crude oil to its refinery through their foreign agents, saying the local price of crude will continue to increase because the trading arms offer cargoes at $2 to $4 per barrel, above NUPRC official price.

The group also alleged that the foreign oil producers seem to be prioritising Asian countries in selling the crude they produce in Nigeria.

A senior official at the Dangote refinery, who pleaded not to be named due to lack of authorisation to speak on the matter, confirmed that the plant had yet to start buying crude in naira from NNPC.

The spokesperson of NNPC, Olufemi Soneye, did not respond to enquiries on the matter when contacted by our correspondent.