Crude Oil Term Contract Awarded To 21 Firms By NNPC

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Nigerian National Petroleum Corporation (NNPC) on Thursday announced that 21 companies had entered into various contracts with it and would henceforth play the role of off-takers of its crude oil grades.

“Apart from ensuring transparency, the companies were carefully chosen based on their track records and trading experience to ensure that Nigerian crude cargoes are not left unsold,” the Corporation said in a statement signed by Ohi Alegbe, its group general manager, group public affairs division.

The companies are winners of an open bid exercise conducted for the said purpose earlier in October.

The exercise witnessed unprecedented submission of 278 bids by indigenous and foreign companies seeking to secure contracts for the sale and purchase of the 26 Nigerian crude oil grades on offer.

A breakdown of the 2015/2016 crude oil term contracts with off-takers for the 991, 661 barrel per day (bpd) Nigerian equity crude indicate that 240,000bpd, representing 24 percent of the total volume on offer, is awarded to four refiners.

The refiners are classified as major current receivers of Nigerian crude with capacity to process all of Nigerian crude grades and include Emirates National Oil Coy, ENOC, Indian Oil Corporation, CEPSA Refinery, Madrid and Sara SPA Refinery. Each of the off-takers in this category was awarded 60,000bpd.

Three notable international trading companies, namely Trafigura PT Ltd, Mercuria Energy Trading SA and Vitol SA won the bid for the lifting of 32, 000 bpd of crude based on their pedigree as large scale buyers of Nigerian crude, and with structured capacity for short term freight intervention and storage. The off-takers in this category represent about 10 percent of the total crude volume on offer.

Trading affiliates of International Oil Companies (IOCs) consisting of ENI Trading and Shipping SPA, TOTSA Total Oil Trading SA, Exxon Sale and Supply LLC, as well as Shell Western Supply and Trading received term allocation of 32, 000 bpd each, totaling 128, 000 bpd and representing about 13 percent of the total volume of crude oil on offer.

Nigerian downstream players with wide experience in crude trading and large asset base account for 405,000bpd, representing about 41 percent of the total crude volume on offer.

In this category, Emo Oil & Petrochemical Coy/China Zhenhea, an NNPC long-term trader, is allocated 45, 000 bpd. Other off-takers in this category include Northwest Petroleum and Gas Ltd, 45, 000 bpd; Forte Oil, 45, 000 bpd; Oando PLC, 60, 000 bpd; Sahara Energy Resource Ltd, 60, 000 bpd; A.A. Rano Nig. Ltd, 45, 000 bpd; Eterna Oil, 45, 000 bpd; and MRS Oil &Gas Coy Ltd, 60, 000 bpd.

NNPC Trading Companies Calson/Hyson also got a contract allocation of 32,000bpd, while Duke Oil Incorporated is entitled to 90,000bpd, cumulatively accounting for 122, 000 bpd off-take and representing about 12 percent of the total volume on offer.

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