The Nigerian National Petroleum Company Limited (NNPC) has signed a fresh two-year crude supply agreement with the Dangote Petroleum Refinery to guarantee steady feedstock for the 650,000-barrel-per-day facility in Lekki, Lagos.
The agreement, finalised in August, ensures that a significant portion of crude supply will continue to be provided in naira under the Federal Government’s “Crude-for-Naira Initiative.” From October 2024 to date, 82 million barrels have been allocated to the refinery, with 60 per cent (49.3 million barrels) sold in naira.
Speaking on the development, NNPC’s Chief Corporate Communications Officer, Andy Odeh, confirmed that crude supply operations for August had been completed, while September loading was ongoing with two vessels undergoing pre-loading checks. He said five crude cargoes each had been earmarked for September and October deliveries.
The deal comes after concerns were raised earlier in the month when the refinery briefly suspended petrol sales in naira due to exhaustion of its crude-for-naira allocation. The suspension was later reversed following intervention by the Presidential Technical Committee.
Meanwhile, the Steering Committee of the Domestic Crude Oil and Refined Products Sales in Local Currency Initiative, chaired by Finance Minister Wale Edun, assured Nigerians that the naira-for-crude arrangement remains intact. Other top government officials, including Budget Minister Atiku Bagudu, FIRS Chairman Zacch Adedeji, the Central Bank, and the NMDPRA, also participated in the reconciliation meeting.
Industry players welcomed the renewed deal. Vice President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Hammed Fashola, described it as a stabilising measure for the downstream sector, while IPMAN spokesperson Chinedu Ukadike urged the Federal Government to extend crude supply allocations to modular refineries.
The Federal Government introduced the naira-for-crude policy last year on the directive of President Bola Tinubu to boost local refining and ensure energy security. With this new agreement, stakeholders expect a more reliable flow of petroleum products into the Nigerian market.
