Home News More Nigeria firms in $60bn oil export deals

More Nigeria firms in $60bn oil export deals

by Business News Report

Federal Government of Nigeria is set to give more bite to its local content pursuit by awarding nearly half of its $60 billion annual supply contracts to local companies, and cut supplies to major commodity traders such as Glencore.
Nigeria has allocated about three-quarters of its daily production or around 1.6 million barrels per day (bpd) via term contracts to 50 companies including 21 Nigerian firms, a document sent to winning firms showed. The oil — which amounts to around 580 million barrels sold over the next 12 months — is worth nearly $60 billion based on current premiums of the country’s light, sweet crude to Brent futures. The tender result, awaited since April, showed that around 45 percent of the allocated oil was earmarked for companies either based in Nigeria or owned by Nigerian companies including state oil firm NNPC’s subsidiary Duke Oil, which doubled the size of its contract from last year to 60,000 bpd.
Industry sources expressed surprise at the number of small Nigerian firms on the list after government pledges to cut back on cronyism in the sector and the introduction of tough new entry requirements for this year’s tender. “The first thing you notice is that this isn’t a significantly shorter list, so the promise to simplify and streamline hasn’t been met,” said an Abuja-based oil industry source who confirmed the contents of the document. On the surface, many of the public’s concerns haven’t been dealt with.” Global oil traders Glencore, Vitol and Trafigura, firms that have traditionally had a strong presence in the the country and last year won the biggest contracts, had their supplies halved to 30,000 bpd.

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