Jonathan Nwokpor
Keep up with latest news and be part of our weekly giveaways and airtime sharing, follow our WhatsApp channel for more update. Click to Follow us
The Nigerian National Petroleum Company Limited, or NNPC, declared on Monday that it had finally stopped the long-standing practice of heavily importing petroleum products after years of doing so.
This follows an earlier announcement by IPMAN, the Independent Petroleum Marketers Association of Nigeria, that it would buy goods directly from the $20 billion Dangote facility.
This statement was made in Lagos by NNPC Group Chief Executive Officer Mele Kyari, who gave the keynote speech at the 42nd annual international conference and exhibition of the Nigerian Association of Petroleum Explorationists, or NAPE.
Kyari highlighted NNPC’s proud co-ownership of the Dangote Refinery, stating that the business saw the $20 billion refinery as a major market for at least 300,000 barrels of its output per day, helping to navigate the challenges of a shrinking crude oil market.
“Oil is found in very many unexpected locations across the world and people have choices. And therefore, we saw an opportunity to now supply to not just Dangote, but every refinery that operates in the country.
“So, it’s a well informed business decision. Therefore, from day one, we knew that it was to our benefit to supply crude oil to domestic refineries.
“So, we don’t need to be persuaded. We don’t need anyone to talk to us. There is no need for any pressure from the streets for us to do this. We are already doing this”, Kyari stated.
In keeping with the company’s pledge to promote local processing of all crude produced in Nigeria, he also disclosed that NNPC had stopped importing refined petroleum products.
Kyari stated: “And therefore, I believe strongly also that we must process all the crude that we produce in the country up to the optimum. And we will do everything possible to make sure that we domesticate this. And today, NNPC does not import any product. We are taking wholly from the domestic refinery.”
He said that because all feedstock supplies are sourced from the domestic market, the company is working with the federal government to address pricing difficulties.
Kyari also emphasised the consequences of the pressure on Nigerian oil producers to provide crude in naira and to local refineries.
Nigerian crude is a premium variety that fetches a premium price, he said.
He clarified that refiners purchase Nigerian oil to mix with their heavier crudes for processing on the international market.
He went on to say that because Nigerian oil is so expensive and premium, very few refineries are prepared to process it directly.
Additionally, Kyari referred to rumours that the NNPC is unwilling to sell crude to domestic refineries in naira as sabotage and rejected them.
He emphasised that whenever they resume production, the other oil producers must send crude to the four NNPC refineries, reminding them that they are also subject to the domestic crude oil requirement.
Selling crude to local refineries in naira, Kyari explained, does not mean that the product’s value is diminished; rather, it merely closes the foreign exchange deficit, strengthening the local currency and bolstering the nation’s economy.
He also disclosed that NNPC has successfully paid off $2.4 billion in outstanding cash-call debt to International Oil Companies that operate in Nigeria.
He affirmed that the business is now debt-free, emphasising that this noteworthy accomplishment was made possible by the total elimination of all subsidies.
Please don’t forget to “Allow the notification” so you will be the first to get our gist when we publish it.
Drop your comment in the section below, and don’t forget to share the post.
