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NNPCL exchanged N2.6 trillion worth of crude oil for refined products in 2021

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The Nigerian National Petroleum Company Limited (NNPCL) traded crude oil valued at N2.6 trillion for refined petroleum products in 2021, according to the latest data from the Nigeria Extractive Industries Transparency Initiative (NEITI), a government agency.

A close examination of crude oil production figures from NEITI’s 2021 Oil and Gas Report revealed that the national oil company did not supply any crude oil to Nigeria’s refineries during the same year. NEITI did note, however, that this could be attributed to the non-operational status of the refineries at that time.

Nigeria’s refineries, located in Port Harcourt, Kaduna, and Warri, have been inactive for an extended period. Nonetheless, rehabilitation efforts are currently underway at these facilities.

The NEITI report clarified that the oil company executed these exchanges of Nigeria’s crude oil for refined products through its Direct Sale Direct Purchase (DSDP) program. The receipts from crude oil sales in 2021 amounted to N2.23 trillion.

Under the DSDP initiative, which was introduced in 2016, selected foreign refiners, trading companies, and indigenous firms are allocated crude supplies in exchange for delivering an equivalent value of petrol and other refined products to the NNPCL.

In response to this data, NEITI commented that “NNPC allocated a total of 98.92 million barrels of crude oil valued at $7.11 billion (N2.73 trillion) for the local market in 2021. However, no crude was delivered to any of the local refineries in 2021. Instead, NNPC used 95.25 percent of this crude for crude exchange for products at the international market under the DSDP arrangement, while 4.75 percent was sold at the international market. This may be due to the fact that none of the refineries were operational in 2021.”

The report also revealed that NNPCL lifted and exported 24.84 million barrels of crude oil valued at $1.70 billion on behalf of the Federation in 2021. Of this, $1.58 billion was traced to respective bank accounts as actual sales receipts in 2021, with $1.55 billion representing 2021 sales receipts and $24.32 million related to the settlement of prior-year receivables.

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