Crude-for-naira sales commenced October 1 – FG

The Federal Government says it has commenced sales of crude oil and other refined products in naira.

It said the initiative commenced on October 1, 2024 without providing further details on the contractual agreement signed and pricing of the product.

The Ministry of Finance disclosed this in a post on its X handle (formerly Twitter) on Saturday.

The statement read, “The Minister of Finance and Coordinating Minister of the Economy announced that, in line with the Federal Executive Council directive, the sale of crude oil and refined petroleum products in naira has officially commenced as of October 1, 2024.
“Following a meeting of the Implementation Committee chaired by the Minister of Finance on October 3, 2024, to conduct a post-commencement review of the Crude Oil and Refined Products Sales in Naira initiative, the commencement of this strategic initiative was affirmed by key stakeholders.”

Last month, the Technical Sub-Committee on Domestic Sales of Crude Oil in Local Currency announced that the Federal Executive Council under the leadership of President Bola Tinubu has approved the sale of crude to local refineries in naira and the corresponding purchase of petroleum products in naira.

“From October 1, NNPC will commence the supply of about 385kbpd (385,000 barrels per day) of crude oil to the Dangote refinery to be paid for in naira,” the committee had declared.
Similarly, the Special Adviser on Media to the Federal Inland Rrevenue Service Chairman, Mr Dare Adekanbi, responded in the affirmative when contacted on Sunday if the plan for the crude oil supply to the $20bn Lekki-based plant was still intact.
But officials of Dangote and other refineries on Thursday stated that they were not aware if the deal had commenced.

Officials at the Dangote refinery and those at the Nigerian Upstream Petroleum Regulatory Commission, Federal Ministry of Finance, and NNPC, among others, also stayed mute when contacted for updates on the naira-for-crude deal between NNPC and Dangote.

The government explained in September that the naira-for-crude initiative would help reduce pressure on the naira, eliminate unnecessary transaction costs, and improve the availability of petroleum products across the country.

“Since then, the implementation committee chaired by the Minister of Finance and we, the technical committee, have worked intensely with NNPC and Dangote refinery to fashion out the details of the modalities for the implementation of the FEC approval,” Adedeji had stated.

While stating that crude would be sold to Dangote in naira from October 1, the committee chairman and FIRS boss said, “In return, the Dangote refinery will supply PMS (petrol) and diesel of equivalent value to the domestic market to be paid in naira.

“Diesel will be sold in naira by the Dangote refinery to any interested off-taker. PMS will only be sold to NNPC. NNPC will then sell to various marketers for now. All associated regulatory costs (NPA, NIMASA, etc.) will also be paid in naira. We are also setting up a one-stop shop that will coordinate service provision from all regulatory agencies, security agencies, and other stakeholders to ensure a smooth implementation of this initiative.”
The statement added that officials at the meeting included the Minister of State, Petroleum (Oil), Heineken Lokpobiri, the Special Adviser to the President on Revenue, Zaccheus Adedeji, the Special Adviser to the President on Energy, Olu Verheijen, the Chief Executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority Engr. Farouk Ahmed, the representative of the Chairman of Dangote Group, the Vice President of Dangote Group, and the management of the Nigerian National Petroleum Company, led by the Group Chief Executive Officer, Mele Kyari, Chief Financial Officer, Umar Ajiya, and the NEPAL Executive Vice President (Downstream), Adeyemi Adetunji.