03 January 2017, Abuja – The Nigerian National Petroleum Corporation on has opened the bids of MRS, Sahara Energy, Aiteo, Glencore, Trafigura and 123 other local and international oil trading firms that had earlier indicated interest to serve as off-takers for 800,000 barrels of the country’s daily crude oil this year.
The bids were opened during a ceremony on tender for the direct sale of crude oil and direct purchase of petroleum products at the corporation’s headquarters in Abuja.
This is coming as the Group Managing Director, NNPC, Dr. Maikanti Baru, announced that the country was able to save over $500m (N153bn) since the DSDP arrangement commenced about a year ago.
On the bid process, he said the corporation would ensure that Nigerians were not left out in the exercise, and noted that the national oil firm would make sure that those who would emerge, whether as a consortium or single company, must have physical presence in the country.
“That means they must have depots or retail outlets as a minimum, or they must be involved with exploration and production of crude oil. So, we will ensure that most of the proceeds are domesticated in Nigeria,” Baru stated.
He added that the DSDP was a major component of its petroleum products’ supply portfolio and since its inception had helped greatly in the stabilisation of products supply across the country.
The over $500m that saved since the introduction of the DSDP, according to the GMD, is through major reductions in the amount paid for both demurrage and the petroleum products.
Baru said, “The programme is very transparent and a major instrument in the partnership between the NNPC and product suppliers, both locally and internationally. We have, as part of this programme, been able to meet our obligation as a supplier of last resort when products are not being supplied by the marketers on the basis of prices that will not give them sufficient margin.
“It has helped us to intervene in the areas of supply of the deregulated products, for example, Aviation Turbine Kerosene, when there was a perceived shortage. We have intervened continuously, by successfully bringing cargoes upon cargoes on a weekly basis, and we ensure that we do not have at any time less than 30 days’ supply of the ATK.”
The Group General Manager, Crude Oil Marketing Division, NNPC, Mr. Mele Kyari, explained that the essence of the tender process was to ensure that good and reliable partners were selected, and urged oil would dealers to be careful with those they deal with in the sector, stressing that the NNPC was not working with agents.
Some other companies that submitted bids are Northwest Petroleum, Forte Oil Plc, Varo Energy Marketing AG, Sinochem/Kaka TMS, Gas Terminal Limited, FMC Energy System Limited, Boron Oil and Gas, Heyden and Oriental Energy Resources Limited .