Naira-for-crude policy remains in place, NNPC Ltd, tech. sub committee clarify 

The Nigerian National Petroleum Company Limited (NNPC Ltd) says it has not terminated the Naira-for-crude contract with Dangote Refinery. 

In a statement Monday in Abuja and signed by Chief Corporate Communications Officer, NNPC Ltd, Olufemi Soneye, the state owned oil firm stated that the initial contract with Dangote Refinery was for 6 months. 

Also,  Chairman Technical Sub-Committee of the policy, Zacch Adedeji, has declared that the Naira-based domestic sales framework remains in Place.

Reports in media outlets over the weekend stated that NNPCL had canceled the Naira to crude deal between  it and the 650,000 barrels per day Dangote Refinery. 

According to the reports, company’s  action had started impacting the price of petrol. 

“NNPC Limited has noted recent reports circulating on social media 

regarding the alleged unilateral termination of the crude oil sales 

agreement in Naira between NNPC and Dangote Refinery.

“To clarify, the contract for the sale of crude oil in Naira was structured as a six-month agreement, subject to availability, and expires at the end of March 2025. Discussions are currently ongoing towards emplacing a new contract. 

“Under this arrangement, NNPC has made over 48 million barrels of crude 

oil available to Dangote Refinery since October 2024. 

On his part, Adedeji, who addressed the Federal Executive Council in Abuja, Monday charged that “These reports do not reflect the realities of the ongoing work under the Federal Executive Council Initiative on Domestic Sales of Crude Oil and Refined Products in Naira.

“As the committee driving the implementation of this laudable initiative, we wish to provide an update on the Federal Executive Council initiative and confirm as follows:

“The Naira-Based Domestic Sales Framework Remains in Place.

“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 optimize 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.

“Local Refineries Have Not Been Excluded from Domestic Crude Supply.

“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. The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is actively ensuring compliance with the Domestic Crude Oil Obligations provisions of the Petroleum Industry Act. 

“The Initiative Supports Competitive Pricing and Market Efficiency.

“The framework for domestic crude transactions is designed to promote a competitive and efficient pricing environment. 

“The Committee Continues Its Work on Strengthening Implementation

“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 stated.