NNPC spent N1.21trn on domestic crude oil purchase

*Crude oil vessel.

*Crude oil vessel.

Ike Amos

05 October 2016, Sweetcrude, Abuja —
The Nigerian National Petroleum Corporation (NNPC) said it spent $6.155 million, an equivalent of N1.206 trillion on the domestic purchase of crude oil in 12 months, from July 2015 to June 2016.

Specifically, in a report obtained from its website, the NNPC stated that it purchased 145.4 million barrels of crude oil, translating to a daily average of 397,279.09 barrels over the 12-month period, at an average price of $42.33 per barrel.

Giving a breakdown of the amount spent on domestic crude oil purchase over the 12-month period, the report stated that for the months of July to December 2015, the NNPC spent N157.78 billion; N95.98 billion; N126.33 billion; N112.279 billion; N93.34 billion and N87.04 billion respectively on the purchase of crude oil.

For the months of January to June 2016, the NNPC expended N62.86 billion; N66.31 billion; N107.62 billion; N107.37 billion; N104.64 billion and N84.78 billion respectively.
However, for June 2016, the report stated that the NNPC lifted 8.958 million barrels of crude oil for domestic utilization, translating to an average volume of 298,624.03 barrels of oil per day in terms of performance.

It said, “In order to meet domestic product supply requirement for the month of June 2016 about 3.776 million barrels of crude oil was processed through Product Exchange, while 3.796 million barrels was processed under the Direct-Sales-Direct Purchase (DSDP) scheme and the balance of 1.387 million was processed in the domestic refineries.”

In addition, the report stated that the combined value of output by the three refineries, at import parity price, for the month of July 2016 amounted to N20.09 billion while the associated crude plus freight cost was N19.31billion, giving a surplus of ₦0.78billion after considering an overhead of ₦7.38billion.

“Despite these challenges, irregular crude supply and impact of pipeline vandalism, the domestic refineries have a consolidated positive cash flow for the month of July under review due to favorable products price variance and ongoing restoration of the refineries,” the report added.

Furthermore, the NNPC stated that in July 2016, 798.33 million litres of white products was supplied into the country through the Direct Sale-Direct Purchase (DSDP) arrangements while 1.184 billion litres was supplied in the month of June 2016, adding that only Premium Motor Spirit, PMS, was supplied through DSDP in the months of June and July 2016.

Generally, the report stated that, “A total of 53.07 million barrels of crude oil and condensate was produced in the month of June 2016, representing an average daily production of 1.77 million barrels.

“This represents an increase of 1.39 per cent compared to May 2016 performance. Of the June 2016 Production, Joint Ventures (JVs) and Production Sharing Contracts (PSC) contributed about 27.49 per cent and 51.54 per cent respectively. While Alternative Finance, Nigerian Petroleum Development Corporation, NPDC and Independent accounted for 14.67 per cent, 2.55 per cent and 3.75 per cent respectively.”

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