NNPCL Begins Crude Sale In Naira To Local Market Oct 1

By Tuesday, October 1, the Nigerian National Petroleum Company Limited (NNPCL) will start the much-anticipated supply of crude to the Dangote Petroleum Refinery in Naira, Nigeria’s local currency.

The Technical Sub-Committee on Domestic Sales of Crude Oil in Local Currency which members including the Permanent Secretary of the Federal Ministry of Finance, 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 to ensure the successful implementation of the initiative, on September 13, 2024, announced approval by President Bola Tinubu to sell crude to local refineries in naira and the corresponding purchase of petroleum products in naira.

“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 Chairman of the Technical Sub-Committee Zacch Adedeji, who doubles as Chairman of the Federal Inland Revenue Service (FIRS) declared.

When contacted on Sunday by The Punch, Dare Adekambi, the Special Adviser on Media to the FIRS Chairman said the plan for the crude oil supply to the $20bn Lekki-based plant is still intact,

“I can confirm to you that the Chairman, Sub-Technical Committee, Zacch Adedeji, is working 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.”

With this, the NNPC will supply about 11.5 million barrels of crude oil to the Dangote 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 initiative would help reduce pressure on the naira, eliminate unnecessary transaction costs, and improve the availability of petroleum products across the country, the committee had explained

“Since then, the implementation committee chaired by the Minister of Finance and we, the technical committee, have worked intensely with NNPC and Dangote refinery to fashion out the details of the modalities to implement the approval by the FEC,” Adedeji had stated.

While stating that crude would be sold to Dangote in naira from October 1, 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.