President Bola Tinubu’s directive for the Dangote Petroleum Refinery and other domestic refineries to start buying crude oil in naira has not yet been implemented.
It claimed that, contrary to Tinubu’s directive from last week, the $20 billion plant and other regional refineries in Nigeria had not yet begun purchasing crude oil in naira from the Nigerian National Petroleum Company Limited.
According to the Nigerian Crude Oil Refiners Association, individual refiners have written to NNPC to request crude, but they have not received a response as of yet.
Tinubu’s proposal to sell crude to the Dangote refinery and other prospective refineries in naira was recently approved by the Federal Executive Council.
The FEC gave its approval for Nigerian refineries to be provided the 450,000 barrels intended for domestic use in naira, with the Dangote refinery serving as a test project. For the period of this transaction, the exchange rate will remain constant.
The refiners claimed, however, that they had not heard from the NNPC nearly a week following the announcement. According to Eche Idoko, the Publicity Secretary of the Nigerian Crude Oil Refiners Association, the Nigerian Midstream and Downstream Petroleum Authority is anticipated to initiate the procedure.
“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.
The CORAN spokesperson had earlier claimed that the naira’s strength versus the dollar would be enhanced and the cost of petrol would be reduced by the local refineries receiving their crude oil supply in naira.
Idoko said Tinubu should write an executive order on the new direction, he praised Tinubu for listening to the voice of indigenous refiners.
In order to determine a rate that would benefit the Nigerian market, the crude oil refiners also requested a meeting with the economic team.
“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 stated.
The challenges of obtaining crude oil for their facilities have been a source of grievance for the Dangote refinery and other refineries in the country.
The Dangote Group’s management recently maintained that the IOCs were still impeding the refinery’s ability to provide crude oil to its 650,000-capacity facility.
The group said in a statement that the IOCs insist on supplying crude oil to its refinery through their international agents, claiming that this will drive up local crude prices as the trading arms offer cargoes at prices that are higher than the NUPRC official pricing, $2 to $4 per barrel.
The group further said that when it comes to selling the crude they produce in Nigeria, the foreign oil companies appear to be giving preference to Asian nations.
A top Dangote refinery official, who begged to remain anonymous because he lacked permission to discuss the issue, said that the facility had not yet begun purchasing crude in naira from NNPC. When a PUNCH journalist phoned Olufemi Soneye, the NNPC spokesman, she did not answer any questions about the situation.
