Cracks have emerged in the direct-sale purchase contracts for refineries crude between the Nigerian National Petroleum Corporation (NNPC) and the refiner-contractors, threatening the $1billion revenue targeted by government.

Investigation by New Telegraph showed that the arrangement, which government entered into in February, began to have issues in July with considerable improvement in refineries’ efficiency.

A financial intelligence report obtained by this newspaper showed that NNPC is “clearly” making moves for “more crude-forproduct swaps or receiving oil products in exchange for crude,” when “the refineries returned to their epilepsy.”

The report, which is already available to some refiners in Europe, is pumping up actions and expectations of the government’s return to the Offshore Processing Agreement (OPA), otherwise known as crude for product swap contracts.

Part of the intelligence report, which was published by Bloomberg, showed that the Europe refiners are targeting 400,000 barrels of oil daily on tips of the NNPC return to crude swap deal.

“Nigeria’s President Muhammadu Buhari, wants to reduce the country’s reliance on fuel imports. Clearly, more crude-for-product swaps or receiving oil products in exchange for crude, would help,” the report entitled: “Nigeria Has a Valley of Tears to Cross Before Benefits,” read.

With a sub-head: “Refining & Marketing, Europe Dashboard,” the report, based on research by Salih Yilmaz, Bloomberg Associate and Philipp Chladek, Bloomberg Senior Industry Analyst, the report noted: “Europe, with refining utilisation rates below 90 per cent for several years, may be a good partner for Nigeria, a net exporter of crude.

“This would facilitate Europe’s access to Nigerian crude and give the country a new export channel after losing market share to shale producers in North America.” Nigeria replaced crudefor- product swaps with direct-sale purchase arrangements early this year, but fuel shortages forced Nigeria back to crude-forproduct deals.

“Swaps should be an interim solution for Nigeria until local supply capacity increases,” the report stated. The Federal Government, it would be recalled, on February 2, declared end to crude-for-products exchange arrangement popularly referred to as crude swap, stating that this initiative would fetch the country $1 billion.

Minister of State for Petroleum Resources who then doubled as Group Managing Director of NNPC, Dr. Ibe Kachikwu, maintained that the crudefor- product exchange arrangement was replaced by a Direct- Sale-Direct- Purchase (DSDP) arrangement, which took off in February.

Kachikwu disclosed this when he appeared before the House of Representatives’ ad hoc Committee set up to investigate the corporation’s offshore processing and crude swap arrangement for the period from 2010 to date at the National Assembly Complex, Abuja.

A statement by NNPC quoted the minister as announcing that the price modulation policy had rid the Federal Government of the burden of subsidy on imported petroleum products in January 2016.

He noted that the DSDP was adopted to replace the crude oil swap initiative and the Offshore Processing Arrangement.

The DSDP option, according to government, eliminated all the cost elements of middlemen and gave the NNPC the latitude to take control of sale and purchase of the crude oil transaction with its partners. “When I assumed duty as the GMD of NNPC, I met the Offshore Processing Arrangement (OPA) and, like you know, there is always room for improvement.

My team and I came up with the DSDP initiative with the aim of throwing open the bidding process,” Kachikwu said. This initiative, he continued, has brought transparency into the crude-forproduct exchange matrix and it is in tandem with global best practices.

Investigation by New Telegraph showed that the arrangement, which government entered into in February, began to have issues in July with considerable improvement in refineries’ efficiency.

osile2012:
[size=18pt]which way Nigeria?.[/size]

jaymejate:
[size=18pt]IT IS FINISHED[/size]

jpphilips:
The Undisputable Facts;

**Since January 2016, the Nigerian government never paid a kobo in subsidies, the DSDP and the improvement in local refining gave birth to cheaper petroleum products and the government made an over recovery within the period.

**The government did not remove any subsidy because there was nothing to remove, they only lied to appeal to familiar rhetorics.
The truth is that the government lost its capacity to provide products due to incessant bombings in the Niger delta.
The last subsidy paid by this administration to the tune of 46b naira was a backlog from the previous administration to enable the marketers take over from the Governmnet.
The take over exposed importers to the Forex uncertainties and the price was hiked to accommodate the marketers interest, so any day you buy PMS above 86.5 naira, blame it on the creek !d!ots bombing everywhere.

** Jonathan Operated a similar regimen to the DSDP called the OPA, while he was at it, we neither made over recovery nor did we have cheaper products, so what happened to our oil they took? as if it wasn't bad enough stealing our oil, we paid subsidy on stolen oil.
OPA must be investigated for Nigerians to know the truth about the economic cankerworm called Goodluck Jonathan

jpphilips:
The Undisputable Facts;

**Since January 2016, the Nigerian government never paid a kobo in subsidies, the DSDP and the improvement in local refining gave birth to cheaper petroleum products and the government made an over recovery within the period.

**The government did not remove any subsidy because there was nothing to remove, they only lied to appeal to familiar rhetorics.
The truth is that the government lost its capacity to provide products due to incessant bombings in the Niger delta.
The last subsidy paid by this administration to the tune of 46b naira was a backlog from the previous administration to enable the marketers take over from the Governmnet.
The take over exposed importers to the Forex uncertainties and the price was hiked to accommodate the marketers interest, so any day you buy PMS above 86.5 naira, blame it on the creek !d!ots bombing everywhere.

** Jonathan Operated a similar regimen to the DSDP called the OPA, while he was at it, we neither made over recovery nor did we have cheaper products, so what happened to our oil they took? as if it wasn't bad enough stealing our oil, we paid subsidy on stolen oil.
OPA must be investigated for Nigerians to know the truth about the economic cankerworm called Goodluck Jonathan

porka:
Buhari should just apologize to Nigerians. Nothing seems to be thought-through before he comes up with reversals of past administration's policies only to come back to the same policy when he has severely burnt his hands.

Recall that this particular policy was said to be the one of the most 'corrupt' policy of the past administration. They used the media to tarnish people's image in the most vicious manner. Only to come back to the same 'corruption'.

dre11:






https://newtelegraphonline.com/oil-swap-cracks-fgs-direct-sale-refineries-crude/

porka:
Buhari should just apologize to Nigerians. Nothing seems to be thought-through before he comes up with reversals of past administration's policies only to come back to the same policy when he has severely burnt his hands.

Recall that this particular policy was said to be the one of the most 'corrupt' policy of the past administration. They used the media to tarnish people's image in the most vicious manner. Only to come back to the same 'corruption'.

jpphilips:
The Undisputable Facts;

**Since January 2016, the Nigerian government never paid a kobo in subsidies, the DSDP and the improvement in local refining gave birth to cheaper petroleum products and the government made an over recovery within the period.

**The government did not remove any subsidy because there was nothing to remove, they only lied to appeal to familiar rhetorics.
The truth is that the government lost its capacity to provide products due to incessant bombings in the Niger delta.
The last subsidy paid by this administration to the tune of 46b naira was a backlog from the previous administration to enable the marketers take over from the Governmnet.
The take over exposed importers to the Forex uncertainties and the price was hiked to accommodate the marketers interest, so any day you buy PMS above 86.5 naira, blame it on the creek !d!ots bombing everywhere.

** Jonathan Operated a similar regimen to the DSDP called the OPA, while he was at it, we neither made over recovery nor did we have cheaper products, so what happened to our oil they took? as if it wasn't bad enough stealing our oil, we paid subsidy on stolen oil.
OPA must be investigated for Nigerians to know the truth about the economic cankerworm called Goodluck Jonathan

sammyj:
FG should just stop this corruption called oil swap just like the previous administration. I hope the same cabal that messed up the last corrupt government is not at it again. God help us against evil forces fighting against this country and PMB should note that we are watching this government actions in 3 D glasses !!!!

Achor1111:
it wouldn't work for him