The highly anticipated naira-for-crude deal between the Nigerian National Petroleum Company Limited (NNPC) and Dangote Petroleum Refinery has yet to commence, despite its scheduled start date of October 1, 2024. This development has left many stakeholders, including domestic refineries, awaiting the government’s next move.
The Technical Sub-Committee on Domestic Sales of Crude Oil in Local Currency had previously announced that the NNPC would supply 385,000 barrels of crude oil per day to the Dangote refinery, to be paid for in naira. However, as of October 3, officials from the Dangote refinery, NNPC, and other relevant agencies have remained tight-lipped about the deal’s status.
The Federal Executive Council, led by President Bola Tinubu, approved the sale of crude to local refineries in naira and the corresponding purchase of petroleum products in naira on September 13, 2024. This move aimed to reduce pressure on the naira, eliminate unnecessary transaction costs, and improve the availability of petroleum products across the country.
Stakeholders are eagerly awaiting updates on the deal, with some expressing concerns about the delay. A senior official from a domestic refinery noted that they were still waiting for communication from the government regarding the agreement.
Key aspects of the deal include:
- Crude Oil Supply: NNPC to supply 385,000 barrels per day to Dangote refinery
- Payment Terms: Payment to be made in naira
- Objective: Reduce pressure on the naira, eliminate unnecessary transaction costs, and improve petroleum product availability
As the situation unfolds, stakeholders remain hopeful that the deal will commence soon, bringing relief to Nigeria’s energy sector.
