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NNPC have set up four new crude oil swap contracts

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The Nigerian National Petroleum Corporation may have set up four new crude oil swap contracts to replace those cancelled last month vital for bringing in about half of the country’s domestic fuel demand, industry sources have said.

The NNPC, under the leadership of Dr. Ibe Kachikwu, had on August 26 announced the cancellation of the contract for the delivery of crude oil to the nation’s refineries in Warri, Port Harcourt and Kaduna.

The corporation also announced the termination of the Offshore Processing Agreement entered into in January 2015 with three companies: namely Duke Oil Company Inc, Aiteo Energy Resources Limited and Sahara Energy Resources Limited.

It said the agreement was “skewed in favour of the companies such that the value of product delivered is significantly lower than the equivalent crude oil allocated for the programme”, adding that the decision to cancel the oil delivery contracts to the refineries was taken after proper evaluation.

The corporation then said it had invited Oando, Sahara Energy, Calson, MRS, Duke Oil, BP/Nigermed and Total Trading to bid for the new OPA.

Though there was a change to the new contract winners, it was unclear whether they would be more transparent, Reuters reported on Wednesday.

It stated that the NNPC had no choice but to continue with some form of swap arrangement, adding that the only other form of petrol input was from a fraud-ridden import subsidy scheme.

But the NNPC said it was an internal arrangement in which three of its subsidiaries were being used to fill the gap created by the recent cancellation of the OPA.

The Group General Manager, Group Public Affairs Division, NNPC, Mr. Ohi Alegbe, in a telephone interview on Wednesday, said, “The true position is that there was OPA agreement; it was not a swap. And it is a stop-gap measure just between now and December, and it involves only three in-house companies, namely: Duke Oil, Napoil and Calson. We are not dealing with any external company.”

Source: Punchng

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