Sahara Energy, Glencore, Gunvpr, Aiteo, MRS, Trafigura and 122 other companies, have expressed their willingness to serve as off-takers for 800,000 barrels per day of Nigerian crude oil in 2017.
Speaking during the bid opening ceremony for tender for the Direct-Sale of crude oil and Direct-Purchase of petroleum products (DSDP) in Abuja, Group Managing Director of the Nigerian National Petroleum Corporation, Mr. Maikanti Baru, assured that the selection of the successful bidders would be guided by over-riding public interest and compliance with extant rules and regulations.
He said, “The major drive here is to ensure that Nigerians are not left out and we will do that by ensuring that those that emerge, whether it is consortium or single, must have physical presence in Nigeria.
“That means they must have depots or retail outlets as a minimum, or they must be involved with exploration and production of crude oil. So we will ensure that most of the proceeds are domesticated in Nigeria.”
Baru said the DSDP is a major component of its petroleum products supply portfolio and since its inception, has helped greatly in the stabilization of products supply to the nation.
He added that the country had been able to save over $500 million since the introduction of the programme through major reductions in the amount paid for both demurrage and the petroleum products themselves.
He disclosed that the DSDP had helped ensured that petroleum products supplies from the refineries are fully augmented to meet the national supply as well as ensure over 30 days sufficiency particularly for petrol.
Baru said, “The programme is very transparent and a major instrument in the partnership between NNPC and products suppliers both locally and internationally. We have as part of this programme been able to meet our obligation as a supplier of last resort when products are not been supplied by the marketers on the basis of prices that would not give them sufficient margin.
“It has helped us to intervene in the areas of supply of the deregulated products, for example, Aviation Turbine Kerosene, ATK, when there was a perceived shortage. We have intervened continuously, by successfully bringing cargoes upon cargoes on a weekly basis and we ensure that we do not have at any time, less than 30 days’ supply of ATK.”
Also speaking, Group General Manager, Crude Oil Marketing Division, Mr. Mele Kyari stated that over the last one year in the DSDP programme, the value of petroleum products received by the NNPC had been higher than the crude oil it gave out.
He said the programme would ensure robust supply, guarantee security of supply and optimize the value of Nigeria’s crude oil.
Kyari explained that the essence of the tender process was to ensure that good and reliable partners are selected; ensure that transparency is entrenched in selecting the off-takers; and promote an efficient procurement process in line with the Public Procurement Act.
He stated that the global crude oil market is currently over-supplied, adding that the volatility in the market and the guidelines surrounding low sulphur content would affect the process and the entire supply value chain.
Some of the bidders are Coco Rivers/BP; Zits and Lords Limited/Pinnacle Oil and Gas; Rainoil Limited, Delmoore Energy; Rahamaniyya Oil and Gas Limited; Red Star Oil and Gas Limited; Acorn Petroleum and Noble Clean Fuels.
Others are: Northwest Petroleum; Forte Oil Plc; Varo Energy Marketing AG; Sinochem/Kaka TMS; gas Terminal Limited; FMC Energy System Limited; Boron Oil and Gas; Heyden; Oriental Energy Resources Limited; Petroldel Nigeria Limited; Omega Butler International Limited; Conoil/Shell Western; Shorelline Natural Resources and Petrolex Oil & Gas among others.
