It has emerged that the Nigerian National Petroleum Company (NNPC) Limited swapped 9 million barrels of oil, valued at $755.74 million under its direct sale, direct purchase arrangement (DSDP) in November 2023.
The NNPC had in June 2023 said it commenced the termination of crude oil swap contracts and would pay cash for petrol imports.
The development followed the removal of the subsidy in May 2023, with petrol prices going above N500 a litre as against the subsidised N185.
“In the last four months, we practically terminated all direct sale direct purchase (DSDP) contracts. And we now have an arm’s-length process where we can pay cash for the imports,” Mele Kyari, NNPC’s group chief executive officer (GCEO), had said.
In an update on October 14, 2023, Kyari told international media that the national oil firm had started purchasing petrol via cash tenders, rather than oil swaps.
However, NNPC’s data published on January 18, 2024 showed that the DSDP arrangement was still in place as at November 2023, TheCable reports.
A breakdown of the transaction revealed that the “DSDP project yield crude oil liftings” gulped a total of 1.85 million barrels, valued at $159.24 million in November last year.
The document also showed that NNPC used 6.66 million barrels (valued at $550.13 million) for its “DSDP PPSA crude oil liftings” deal in the same month.
It also said a total of 516,235 barrels was used for the “Federal Inland Revenue Service (FIRS) DSDP crude oil liftings”. The deal was worth $46.35 million — bringing the total value of the transactions to $755.74 million.
According to the data, NNPC’s customers (clients) in the oil swap deals were the Gulf Transport and Trading, AA Rano Nigeria, PV Oil Singapore PTE Limited, Oando Plc, Sahara Energy Resources, Mercuria, Mocoh SA, and Oando DMCC.
There is a possibility that this arrangement might be responsible for why petrol prices have remained stable since the subsidy removal, despite high crude oil prices and surging exchange rates in the black and official markets.
Leave a Reply