Oscarline Onwuemenyi 10 February 2016, Sweetcude, Abuja – The Nigerian National Petroleum Corporation, NNPC’s, planned Direct-Sale–Direct-Purchase, DSDP, arrangement for the sale of Nigerian crude and import of petroleum products would commence next month.
This would be happening two months behind schedule as the government’s original plan was for the new arrangement to take-off in January.
The DSDP arrangement would replace the existing controversial crude-for-products exchange arrangement, which has allegedly cost Nigeria billions of Naira in lost revenues through corrupt practices between officials of the Petroleum Ministry and the NNPC on one hand, and foreign oil trading companies doing business with Nigeria.
Under the old order, crude oil was exchanged for petroleum products through third party traders at a pre-determined yield pattern.
Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, who announced next months take-off of the new arrangement, stated that the DSDP option eliminates all the cost elements of middlemen and gives the NNPC the latitude to take control of sale and purchase of the crude oil transaction with its partners.
According to him also, the DSDP initiative whittles down the influence of the Minister in the selection of bid winners as it allows all the bidders to be assessed transparently based on their global and national track record of performance before the best companies with the requisite capacities are selected.
Throwing more light on the need for the introduction of the DSDP, Dr. Kachikwu noted that the policy is aimed at reducing the gaps inherent in the Offshore Processing Arrangement, OPA, and the losses incurred by the NNPC in the past.
He said the new arrangement would also help the Corporation to grow indigenous capacity in the international crude oil business and generate employment opportunities for indigenous companies that are selected.