The Federal Government and crude oil producers in Nigeria have agreed to work towards a sustainable supply of crude oil to local refineries under a market-determined pricing system.
According to the Nigeria Upstream Petroleum Regulatory Commission (NUPRC), oil refiners in the country have been directed to provide monthly price quotes on crude supply.
This comes as the $20bn Dangote Petroleum Refinery is reportedly ramping up the importation of crude from the United States.
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NUPRC Chief Executive, Gbenga Komolafe, stated that President Bola Tinubu is committed to providing a level playing ground for producers and refiners to do business in the industry. “We need to have the price quotes monthly,” he directed.
Komolafe emphasized the need for a rule of engagement to ensure that the pricing model from oil producers does not hinder domestic refineries.
“We allow all our processes to be transparent. While the Federal Government targets the implementation of the regulation, all parties must submit to the rules of engagement as a guide for operation,” he said.
The NUPRC boss pointed out a convergence between the Domestic Crude Oil Supply Obligation and the nation’s energy security, indicating that his team is re-engineering its regulatory processes to address the challenges.
“We are committed to driving the willing buyer/willing seller provision. We will never allow price strangulation to disincentivize our domestic refining capacity optimization.”
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Last month, the Vice President of Oil and Gas at Dangote Industries Limited, Devakumar Edwin, had accused International Oil Companies in Nigeria of plans to frustrate the survival of the new Dangote Petroleum Refinery.
“It seems that the IOCs’ objective is to ensure that our petroleum refinery fails. They are keen on exporting the raw materials to their home countries, creating employment and wealth for their countries, adding to their Gross Domestic Product, and dumping the expensive refined products into Nigeria.”
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