The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) says several upstream oil producers resisted the government’s directive mandating them to allocate a portion of their output to local refineries.
In its 2024 annual report, the commission said producers
submitted formal letters requesting waivers or offering reasons they might not
meet the mandated domestic supply volumes.
The report was obtained from the NUPRC’s website on Friday.
“The Commission received several pushbacks from IPPG, OPTS, some
producers and their equity partners via formal letters, either requesting for
waivers on the allocated monthly obligations, or giving detailed explanations
why they might not be able to meet up with the allocated volumes etc. (August
16th, 2024),” the report reads.
The NUPRC said it facilitated the delivery of crude to
Dangote refinery and other domestic processors in February 2024, using its
monthly production curtailment platform.
According to the report, a working committee was set up with
representatives from the NUPRC, Oil Producers Trade Section (OPTS), Independent
Petroleum Producers Group (IPPG), and the Crude Oil Refinery-Owners Association
of Nigeria (CORAN).
The panel was tasked with developing a comprehensive
framework for implementing the domestic crude supply obligations (DCSO) policy.
The commission said it developed a metric-based allocation
model that considers each producer’s operational capacity — past, present, and
forecasted — and would issue corresponding daily supply obligations
bi-annually.
The report noted that the DCSO guidelines, based on a
jointly developed operational template, were adopted by the commission but
rejected by stakeholders.
“Meeting with the Permanent Secretary, Ministry of Petroleum
Resources and other relevant stakeholders in the industry towards the
implementation of domestic crude supply obligations (Sept 2nd, 2024, at the
NNPC towers),” the report further reads.
“Following several complaints from operators about the
presence of refiners at curtailment meeting, another letter was sent to
refiners, notifying them of the Commission’s decision to put all refiners’
attendance at the monthly Production Curtailment Meeting (PCM) on hold
temporarily till further notice (Sept 13th, 2024).”
The NUPRC said it received a status update from the Nigerian
National Petroleum Company (NNPC) Limited, through its subsidiary, NNPC Trading
Ltd (NTL), on crude supply to Dangote refinery on September 20, 2024.
Despite the setbacks, the NUPRC said it continued to
facilitate crude allocation to local refineries.
The commission said it also ensured transparency by
publishing relevant data on its website and in three national newspapers on
July 1, 2024 and January 1, 2025, in line with regulatory requirements.
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