KEY POINTS
- NNPC crude deal secures local supply to Dangote refinery.
- 82 million barrels allocated, with 60 percent in naira.
- Marketers say pact boosts energy security and stability.
The Nigerian National Petroleum Company Limited has finalized a new two-year crude oil supply deal with Dangote Refinery.
The agreement, reached in August though revealed this week, anchors government efforts to sustain its domestic energy security program.
Under the terms, NNPC will deliver 82 million barrels of crude between October 2024 and October 2025.
Of this total allocation, 49.3 million barrels, representing 60 percent, will be transacted in naira currency.
This arrangement reflects President Tinubu’s determination to strengthen Nigeria’s crude-for-naira initiative and ensure consistent supply for domestic refining.
NNPC crude deal secures local supply
NNPC spokesperson Andy Odeh confirmed the agreement in an interview, saying the company continues to allocate crude in naira to support domestic sales of refined products.
He explained that NNPC, the Dangote refinery and the Nigerian Midstream and Downstream Petroleum Regulatory Authority reconcile volumes and pricing periodically to ensure allocations align with delivered crude.
Odeh added that three naira crude cargoes were delivered in August, with five cargoes each allocated for September and October. While August loadings have been completed, September operations remain underway with two vessels undergoing pre-loading checks.
The new sales and purchase agreement, signed with Dangote Petroleum Refinery and Petrochemical, runs through 2027. It builds on last year’s presidential directive requiring local crude sales to domestic refineries, beginning with Dangote’s 650,000-barrel-a-day plant in Lekki, Lagos.
Oil marketers welcome renewed commitment
Marketers have welcomed the pact, describing it as critical to energy security. Hammed Fashola, vice president of the Independent Petroleum Marketers Association of Nigeria, said the agreement would stabilize supply and reduce reliance on imported crude. IPMAN spokesman Chinedu Ukadike echoed the sentiment, urging the government to extend allocations to modular refineries as well.
The steering committee overseeing the crude-for-naira initiative, chaired by Finance Minister Wale Edun, reiterated its continuity commitment.
According to Punch, officials emphasised that domestic petroleum product supplies would remain uninterrupted, despite recent frictions between Dangote Refinery management and labour unions.
Industry experts observed the deal aims to safeguard consumers from sudden supply shocks and volatile prices affecting national energy security.
The agreement also strengthens the refinery’s capacity to operate steadily, ensuring resilience within Nigeria’s evolving domestic refining sector.
For Dangote, the pact ensures predictable feedstock supplies after erratic crude allocations previously forced occasional reliance on U.S. barrels.
