BREAKING: Dangote Calls Out NNPCL Over Naira-For-Crude Initiative Default

Dangote has called out NNPCL over the Naira-For-Crude Initiative default.

 

NewsOnline Nigeria reports that the Dangote Petroleum Refinery has revealed that the Federal Government is falling short of its commitment to supply crude oil under the naira-for-crude initiative.

 

According to Dangote Industries Limited Vice President, Devakumar Edwin, the refinery has received only a fraction of the agreed volume of crude oil from the Nigerian National Petroleum Company Limited (NNPCL), which is insufficient to boost refined product output.

 

This Nigeria news platform understands that Edwin disclosed in a Reuters report that the NNPCL had pledged to supply at least 385,000 barrels per day (bpd) since the program’s launch in October.

 

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However, the deliveries have been significantly below that target.

“We need 650,000 bpd. NNPCL agreed to give a minimum of 385,000 bpd, but they are not even delivering that,” he stated.

 

The naira-for-crude initiative, introduced in July, was intended to ease foreign currency pressures by allowing local refineries to purchase crude oil in naira.

 

Despite this arrangement, industry insiders told The PUNCH that while four crude oil shipments have been delivered to the Dangote refinery, further deliveries are still pending.

 

Less than two months into the program, the refinery is reportedly considering alternative crude supply options, including imports from the United States.

 

On Wednesday, the facility procured two million barrels of US WTI Midland crude—the first such purchase since August—highlighting its reliance on international markets amid domestic supply challenges.

 

The $20 billion refinery in Lekki, which aims to compete with European facilities, is operating below its full capacity of 425,000 bpd and targets 85% capacity by year-end.

 

Edwin described the crude deliveries from NNPCL as “peanuts,” underscoring the gap between the refinery’s needs and available resources.

 

The acting Executive Director of the Crude Oil Refinery-Owners Association of Nigeria, Mathins Obaze, confirmed that Dangote is the sole refinery benefitting from the naira-for-crude deal among the eight operational refineries in the country.

 

However, Obaze noted that most members are still unable to access crude under the initiative and are in discussions with the government for a resolution.

 

The reasons behind the crude supply shortfall remain unclear, with both the NNPCL and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) declining to comment on the matter.

 

Dangote had previously urged NUPRC to enforce regulations mandating oil producers to prioritize local refineries.

 

Meanwhile, the NNPCL is pursuing new international markets for its crude oil.

 

The company recently sought term customers in London for its newly introduced Utapate crude oil grade, reflecting its strategy to explore global opportunities despite domestic supply issues.