Dangote Refinery, Others Yet to Buy Crude Oil in Naira Despite Presidential Directive

Dangote Oil Refinery and other local refineries are yet to start buying naira crude oil as per President Bola Tinubu’s directive.
The $20 billion facility and other local refineries are yet to start buying naira crude oil from the Nigerian National Petroleum Corporation as per Tinubu’s directive last week.
The Nigerian Crude Oil Refiners Association said individual refineries have written to the NNPC requesting crude oil but got no feedback.
The Federal Executive Council recently approved Tinubu’s proposal to sell crude oil to Dangote Refinery and other prospective refineries for naira.

The FEC approved the provision of 450,000 barrels designated for domestic consumption to the Nigerian Refinery for naira, with the Dangote Refinery acting as a pilot project. The exchange rate will be fixed for the duration of the deal.
But almost a week after the announcement, refiners said they had not heard from NNPC.
Eche Idoko, spokesperson for the Nigerian Crude Oil Refiners Association, said the Nigerian Midstream and Downstream Petroleum Agency was set to kick-start 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.
CORAN spokesman had previously said that supplying naira crude oil to local refineries would lower gasoline prices and strengthen the naira against the dollar.
Idoko commended Tinubu for listening to the voices of domestic refiners but noted that implementing regulations should be issued for any new policy.
The crude oil refiners also called for a meeting with the economic team to formulate tariffs that would benefit 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 explained.
Dangote Refinery and other domestic refineries have complained of difficulties in procuring crude oil for their plants. Recently, Dangote Group management claimed that IOC will continue to block crude oil supplies to the 650,000-barrel capacity refinery.
The group, in a statement, argued that local crude oil prices will continue to rise as IOC insists on selling crude oil to refineries through foreign representatives and trading companies are offering cargoes at $2 to $4 per barrel above the official NUPRC price.
The group also alleged that foreign oil producers appear to be giving preferential treatment to Asian countries when selling crude oil they produce in Nigeria.
A senior official at Dangote Refinery, speaking on condition of anonymity as he was not authorized to comment on the matter, confirmed that the plant is yet to start buying naira crude oil from NNPC.