President Tinubu has issued a directive for the Nigerian National Petroleum Company Limited (NNPCL) to conduct crude oil sales to Dangote Refinery in Naira.
This mandate was confirmed by Bayo Onanuga, a presidential media aide, in a statement via his official X account on Monday. The objective of this directive is to uphold the stability of the refined fuel pump price and the dollar-Naira exchange rate.
The Federal Executive Council has endorsed President Tinubu's proposal to sell crude oil to Dangote Refinery and other upcoming refineries in Naira, aiming to assist in achieving this objective.
Presently, Dangote Refinery necessitates 15 cargoes of crude annually, amounting to $13.5 billion. NNPC has committed to supplying four of these cargoes.
However, the Federal Executive Council has approved that the 450,000 barrels intended for domestic consumption be supplied to Nigerian refineries in Naira, with Dangote Refinery serving as a pilot project. Moreover, a fixed exchange rate will be implemented throughout this transaction.
Afreximbank and other settlement banks in Nigeria will facilitate the trade between Dangote Refinery and NNPC Limited, streamlining the process. This significant intervention is expected to eliminate the requirement for international letters of credit and result in substantial cost savings for the country by reducing the need for imported refined fuel.
This development unfolds against the backdrop of the ongoing disagreement involving the 650,000 barrel-per-day Dangote Refinery, NNPCL, Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), and other regulatory bodies in Nigeria's oil and gas sector.
Stay tuned for further updates!