NNPC speaks on supplying crude oil to Dangote in Naira

• On Tuesday, the NNPCL is expected to begin delivering oil in naira to the Dangote Petroleum Refinery
• Zach Adedeji is the chairman of the Technical Subcommittee on Domestic Sales of Oil in Local Currency
• This occurred after FG earlier authorized the naira purchase of petroleum products and the naira sale of crude

Legit.ng journalist Zainab Iwayemi has over 3-year-experience covering the Economy, Technology, and Capital Market.

The Nigerian National Petroleum Company Limited is scheduled to start supplying the Dangote Petroleum Refinery with oil in naira on Tuesday, October 1, 2024, according to a confirmation made on Sunday by the Technical Sub-Committee on Domestic Sales of oil in Local Currency led by Zach Adedeji as the Chairman.

The $20 billion Lekki plant's crude oil supply agreement is still in effect, according to the FIRS Chairman. Photo Credit: Dangote
Source: UGC

The committee declared on September 13, 2024, that the Federal Executive Council, led by President Bola Tinubu, had authorized the naira purchase of petroleum products and the naira sale of crude to nearby refineries.

“From October 1, NNPC will commence the supply of about 385kbpd (385,000 barrels per day) of crude oil to the Dangote refinery to be paid for in naira,” the committee had declared.

Mr. Dare Adekanmbi, the Special Advisor on Media to the FIRS Chairman, said that the arrangement to provide crude oil to the $20 billion plant located in Lekki is still in place.

He said,

“I can confirm to you that the Chairman, Sub-Technical Committee, Zacch Adedeji, is working day and night to ensure that things go according to plans. He knows how important it is to have the agreement implemented as has been planned for the benefit of Nigerians.”

NNPC to supply 11.5 million barrels

This implies that NNPC is to supply about 11.5 million barrels of crude oil to the Dantote refinery monthly, and based on the deal, the plant will release equivalent volumes of refined diesel and petrol to the domestic market also in naira.

The committee chairman and FIRS boss said,

“In return, the Dangote refinery will supply PMS (petrol) and diesel of equivalent value to the domestic market to be paid in naira.“Diesel will be sold in naira by the Dangote refinery to any interested off-taker. PMS will only be sold to NNPC. NNPC will then sell to various marketers for now. All associated regulatory costs (NPA, NIMASA, etc.) will also be paid in naira. "We are also setting up a one-stop shop that will coordinate service provision from all regulatory agencies, security agencies, and other stakeholders to ensure a smooth implementation of this initiative.”

Adedeji explained that the technical committee that worked to flesh out the initiative would transition to an implementation execution and monitoring committee that would be working out of Lagos for the next three to six months.

The committee, which includes the Permanent Secretary of the Federal Ministry of Finance, Mrs Lydia Jafiya; the FIRS boss, as well as representatives from NNPC, Central Bank of Nigeria, AfreximBank, and the Nigerian Upstream Petroleum Regulatory Commission, was set up to craft a robust template that will ensure the successful implementation of the initiative.

Meanwhile, modular refineries have called on the government to work out modalities for the supply of crude to their plants as well.

Dangote petrol prices emerge

Legit.ng reported that the Nigerian National Petroleum Corporation Limited (NNPCL) has started lifting Premium Motor Spirit (PMS), also known as petrol, from Dangote Refinery today, Sunday, 15 September 2024.

On Saturday, the national oil company announced that at least 300 trucks are stationed at the Lekki, Lagos refinery.

The news has been greeted with excitement by Nigerians who hope that development will mean cheaper petrol prices at filling stations.

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Source: Legit.ng