The Federal Government has commenced the sale of crude oil to local refineries, with transactions conducted in Naira in significant development aimed at easing pressure on the Naira, cutting transaction costs, and enhancing the availability of petroleum products
The Honourable Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, announced this breakthrough on Friday in Abuja, following a Technical Sub-Committee meeting on the matter.
This was disclosed by the Special Adviser Information and Strategy to President Tinubu, Bayo Onanuga via his X account.
This move marks a pivotal step in streamlining the petroleum sector and supporting the local economy.
Edun represented by the Executive Chairman Federal Inland Revenue Service, Dr. Zacch Adedeji, announced the completion of all agreements and modalities for the implementation of the Federal Executive Council approval on the sale of crude to local refineries in Naira and corresponding purchase of petroleum products in Naira.
“Recall that the FEC under the leadership of Mr. President approved the sale of crude to local refineries in Naira and corresponding purchase of petroleum products in Naira.
“This initiative will help reduce pressure on the Naira, eliminate unnecessary transaction costs, and improve availability of petroleum products in the country Since then, the implementation committee chaired by the Hon Minister of Finance and the technical committee have worked intensely with NNPCL and Dangote Refinery to fashion out the details of the modalities for the implementation of the FEC approval.
“I am glad to announce that all agreements have been completed and loading of the first batch of PMS from the Dangote Refinery will commence on Sunday 15th September From 1st October, NNPC will commence the supply of about 385kbpd of crude oil to the Dangote Refinery to be paid for in Naira, in return, the Dangote Refinery will supply PMS and diesel of equivalent value to the domestic market to be paid for in Naira.
“Diesel will be sold in Naira by the Dangote Refinery to any interested offtaker,” the Minister said.
Recall it was previously reported that the Nigerian National Petroleum Company Limited and Dangote Petroleum Refinery were finalizing negotiations on the sale of crude oil from NNPC to the Dangote refinery in Naira, as well as the buy-back of refined petroleum products from the $20 billion plant, also in Naira.
And the parties involved may conclude discussions the following week.
The Vice President of Oil and Gas at Dangote Industries Limited, Devakumar Edwin, declared on Thursday during a space session organised by Nairametrics on X.
In the report, Edwin also stated that the NNPC had demanded to oversee the production of refined products at the Dangote refinery, based on the fact that the national oil company would supply crude to the plant.
He said, “Now we are still discussing with the government to give us the crude in naira. The discussions have been going on. It has not yet been concluded. When we buy the crude from them in naira, they will take the products back from us in naira, that’s where we are. We are still in discussions.
“So now whatever we are producing, they will buy back from us. In fact, NNPC has told us they will have a team of six to 10 people permanently stationed inside our refinery. They even told us we should give them office space because they are going to give the crude.
“They are going to monitor the production and then they will buy it back in naira. So, this is where we are and we are waiting for the conclusion of the discussions. Hopefully, by next week, if it gets concluded, we can kick off.”
