By Ologeh Joseph Chibu
The planned supply of crude oil in Naira by the Nigerian National Petroleum Company Limited (NNPC) to the Dangote Petroleum Refinery, set to begin on October 1, 2024, has yet to commence as at this weekend.
When contacted for updates, officials from the Dangote Refinery, NNPC, the Nigerian Upstream Petroleum Regulatory Commission, and the Federal Ministry of Finance remained silent on the status of the naira-for-crude deal.
This follows an earlier announcement by the Technical Sub-Committee on Domestic Sales of Crude Oil in Local Currency, confirming that the supply would begin on October 1.
In mid-September, the committee revealed that the Federal Executive Council, under President Bola Tinubu, had approved the sale of crude to local refineries in naira, as well as the purchase of petroleum products in the same currency. The plan was for NNPC to supply 385,000 barrels of crude per day (bpd) to the $20 billion Dangote Refinery, with payments to be made in naira.
Chairman of both the Technical Sub-Committee and the Federal Inland Revenue Service, Zacch Adedeji, had previously assured that efforts were in motion to implement the agreement as scheduled. His media aide, Mr. Dare Adekanmbi, reiterated that the team was “working day and night” to ensure the deal would proceed smoothly.
However, insiders at three domestic refineries revealed that they had not received any official communication regarding the start of crude deliveries in naira. While the government committee overseeing the initiative reportedly assured operators that progress was being made, a senior refinery official confirmed that no agreements had been finalized as of October 3.
Another source with a major modular refinery stated that although the refiners had been in contact with the government, no official notice had been received. “Deals like this take time to finalize,” the source noted, indicating that additional steps were needed before the agreement could be implemented.
The naira-for-crude initiative, announced in September, aims to reduce pressure on Nigeria’s currency by eliminating foreign exchange transaction costs and improving the availability of petroleum products domestically. According to Adedeji, the Dangote Refinery will supply petrol and diesel of equivalent value to the domestic market, with all associated costs, including regulatory fees, paid in naira.
The Technical Sub-Committee is now transitioning to an execution and monitoring team, which will oversee the implementation of the deal over the next three to six months. Despite delays, officials remain optimistic that the naira-for-crude initiative will move forward as planned.
