Oando, 20 others win NNPC crude lifting contracts

18 December 2015, abuja -Shell, Total, Oando Plc and international trading firms, Trafigura and Vitol, are among companies handed crude oil lifting contracts for 2016 by the Nigerian National Petroleum Corporation.

Oando logoThe NNPC on Thursday announced 21 off-takers as winners of the open bid exercise conducted in October, when 278 bids were submitted by indigenous and foreign firms seeking to secure contracts for the sale and purchase of the 26 Nigerian crude oil grades on offer.

A breakdown of the 2015/2016 crude oil term contract off-takers for the 991,661 barrels per day Nigerian equity crude indicates that 240,000 bpd, representing 24 per cent of the total volume on offer, were awarded to four refiners classified as major current receivers of Nigerian crude.
The four have the capacity to process all of Nigerian crude grades, according to a statement signed by the Group General Manager, Group Public Affairs Division, NNPC, Mr. Ohi Alegbe.

He stated that the off-takers in this category were Emirates National Oil Company, Indian Oil Corporation, CEPSA Refinery Madrid and Sara SPA Refinery, with each awarded 60,000bpd.

According to the corporation, three notable international trading companies, Trafigura PT Limited, Mercuria Energy Trading SA and Vitol SA, won the bid for the lifting of 32,000 bpd of crude based on their pedigree as large scale buyers of Nigerian crude with structure for short-term freight intervention and storage.

Trading Affiliates of International Oil Companies consisting of ENI Trading and Shipping SPA, TOTSA Total Oil Trading SA, Exxon Sale and Supply LLC and Shell Western Supply and Trading received term allocations of 32,000 bpd each, totalling 128,000 bpd and representing about 13 per cent of the total volume of crude oil on offer.

The statement explained, “Nigerian downstream players with wide experience in crude trading and large asset base account for 405,000 bpd, representing about 41 per cent of the total crude volume on offer. In this category, Emo Oil & Petrochemical Company/China Zhenhea, an NNPC long-term trader, is allocated 45,000 bpd.”

Others include Northwest Petroleum and Gas, 45,000 bpd; Forte Oil, 45,000 bpd; Oando Plc, 60,000 bpd; Sahara Energy Resources, 60,000 bpd; A. A. Rano Nigeria, 45,000 bpd; Eterna Oil, 45,000 bpd; and MRS Oil & Gas Company, 60,000 bpd.

The NNPC Trading Companies Calson/Hyson, 32,000 bpd; and Duke Oil Incorporated, 90,000 bpd, account for a combined off-take of 122,000 bpd or about 12 per cent of the total volume on offer.

The minister also on Thursday clarified his statement on the pump price of petrol, saying the government had yet to arrive at a particular price, but noted that the product would be sold within a band of N87 to N97 per litre depending on the global cost of crude oil in 2016.

He also stated that the NNPC would be unbundled into four different companies, adding that the country’s four refineries would not be sold in their present poor state in order to avoid selling them as scraps.

He stated these during a town hall meeting held at the headquarters of the NNPC in Abuja.

Kachikwu, who doubles as the Group Managing Director of the NNPC, stated that he was committed to reducing the amount being spent by the Federal Government as subsidy on petrol.

He, however, noted that President Muhammadu Buhari was not fully in support of the complete withdrawal of subsidy because “he does not want the poor to suffer in whatever we do. So, we can’t say we will yank it (subsidy) off just like that and this needs a lot of intellectual inputs to ensure some form of palliatives in the process.

The minister added, “Therefore, it is not that you remove subsidy, it is the application of the market mechanism. Is it going to be sold at N87 or N97 per litre? We are going to ask the PPPRA to get us the templates and know exactly what to do. But we are going to have a band on what is approved. We can have a band of between N87 and N97 and look at the price of crude. It is not going to be a static thing.”Oando logo

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