The Nigerian National Petroleum Company Limited (NNPCL) and the Dangote Petroleum Refinery have commenced crucial negotiations for the renewal of their naira-for-crude agreement, as the initial six-month deal approaches its expiration on March 31, 2025. Hobnob News has obtained details of the ongoing discussions, which aim to solidify a new contract for continued crude oil supply to the nation’s largest refinery.
This development comes in response to circulating claims that the NNPCL had unilaterally terminated the naira-for-crude arrangement until 2030. However, the NNPCL has clarified that the initial deal was always intended to be a six-month pilot program, and the renewal talks are a natural progression of the partnership.
NNPCL’s Chief Corporate Communications Officer, Olufemi Soneye, confirmed that since the agreement’s inception in October 2024, the Dangote Refinery has received over 48 million barrels of crude oil. In total, the refinery has received over 84 million barrels since it began operations in 2023. Soneye emphasized that the deal’s continuation is contingent on crude oil availability and mutually agreed terms.
“NNPC Limited has noted recent reports circulating on social media regarding the alleged unilateral termination of the crude oil sales agreement in naira between NNPC and Dangote Refinery,” Soneye stated. “To clarify, the contract for the sale of crude oil in naira was structured as a six-month agreement, subject to availability, and expires at the end of March 2025. Discussions are currently ongoing towards emplacing a new contract.”
The Chairman of the Technical Sub-Committee on the naira-for-crude deal, Zacch Adedeji, echoed the NNPCL’s stance, reaffirming the government’s commitment to the policy. He emphasized that the naira-for-crude initiative has proven to be beneficial for the Nigerian economy and will continue to be implemented.
“The policy framework enabling the sale of crude oil in naira for domestic refining remains in force,” Adedeji asserted. “The initiative was designed to ensure supply stability and optimize the utilization of local refining capacity. There has been no decision at the policy level to discontinue this approach, nor is it being considered. After implementing the policy for some months, evidence abounds that it is the right way to go, and it will continue to help the economy.”
Adedeji also clarified that local refineries are not excluded from domestic crude supply and that the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is actively ensuring compliance with the Domestic Crude Oil Obligations provisions of the Petroleum Industry Act.
An analysis of crude oil liftings from NNPCL’s monthly presentations at the Federal Account Allocation Committee (FAAC) meetings reveals that the Dangote Refinery received crude oil worth approximately N486.31 billion between October and December 2024. However, as of last month, approximately N199.96 billion was listed as obligations due for remittance and yet to be paid.
The analysis also showed that the refinery received its highest allocation of crude oil on October 14, 2024, totaling 598,125 barrels, and its lowest allocation on October 30, 2024, totaling 5,000 barrels.
As the NNPCL and Dangote Refinery engage in contract renewal discussions, stakeholders are closely monitoring the developments, anticipating a continued partnership that benefits the Nigerian economy.
