NNPC Signs Oil-Swap Deals Worth $755 Million With Oando Plc, Others
- The Nigerian National Petroleum Corporation said it awarded new oil swap contracts for $755 million
- The companies involved are AA Rano Nigeria, PV Oil Singapore PTE Limited, Oando Plc, and others
- This came despite the fact that the company said it was terminating the programme in June last year
Legit.ng journalist Zainab Iwayemi has over three years of experience covering the Economy, Technology, and Capital Market.
In one month, the Nigerian National Petroleum Corporation (NNPC) Ltd. awarded new oil swap contracts for $755 million.
Source: UGC
The contracts, also known as the direct sale and purchase agreements, or DSDP, are in high demand since they meet nearly all of Nigeria's gasoline needs and somewhat offset its diesel and jet fuel use.
Since 2016, NNPC has been importing gasoline from groups of international and local trading companies and paying them back with crude oil through DSDP contracts because it lacks the funds to cover the purchases, according to data and trading sources.
However, the company had claimed that the program would terminate in June following the removal of the subsidy, according to a BusinessDay report.
Mele Kyari, group CEO of NNPC Ltd, told Reuters last June:
“In the last four months, we practically terminated all DSDP contracts. And we now have an arm’s-length process where we can pay cash for the imports."
New data
As of last November, evidence gathered from NNPC's financial records showed that the company had awarded oil exchange deals to Gulf Transport and Trading, AA Rano Nigeria, PV Oil Singapore PTE Limited, Oando Plc, Sahara Energy Resources, Mercuria, Mocoh SA, and Oando DMCC.
Additional analysis revealed that in November last year, the DSDP project yielded crude oil liftings that swallowed 1.85 million barrels, valued at $159.24 million.
According to NNPC's record, the company used 6.66 million barrels—worth $550.13 million—for its DSDP PPSA crude oil liftings agreement in the same month.
The discovery came when there was a growing demand for transparency in the company's activities.
Legit.ng reported that the NNPC made zero allocation to the Federation Account in 2022 due to subsidy payments on petrol.
The NNPCL is a primary revenue-generating agency in Nigeria as it manages and sells Nigeria's crude oil and gas, among other essential functions.
The report claims that NNPC deliberately moved revenue accounts to CBN
Legit.ng reported that following a report that the federal government directed the NNPCL to move its accounts to the Central Bank of Nigeria (CBN), new findings have revealed another twist to the story.
Legit.ng also earlier reported that the NNPCL would no longer be in charge of revenue generated from the sale of crude oil.
A New Telegraph report stated that the CBN will now manage the revenue accrued from oil sales per a directive from President Bola Tinubu.
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Source: Legit.ng
