The Nigerian National Petroleum Company Limited (NNPC) has finalized a significant two-year crude supply agreement with the Dangote Petroleum Refinery, ensuring a reliable supply of crude oil to the 650,000-barrel-per-day facility located in Lekki, Lagos.
This strategic deal, signed last month, aligns with the Federal Government’s commitment to enhance crude supply to the refinery, particularly in naira.
Reports indicate that approximately 82 million barrels of crude have been allocated to the Dangote refinery from October 2024 to October 2025, with 60 percent—about 49.3 million barrels—purchased in naira. This comes after the refinery recently halted petrol sales in naira due to the depletion of its crude-for-naira allocation. However, following interventions from the Naira-for-Crude Technical Committee, the refinery resumed sales, highlighting the importance of this agreement.
Andy Odeh, the Chief Corporate Communications Officer of NNPC, confirmed that the company has consistently allocated crude to the refinery in naira. He explained that the NNPC, Dangote Refinery, and the Nigerian Midstream and Downstream Petroleum Regulatory Authority regularly reconcile the volume and cost of crude supplied in naira against the crude delivered.
Odeh stated, “In line with the FGN Crude for Naira Initiative, NNPC Limited has continued to allocate crude to Dangote refinery in naira for the sale of products in the domestic market.” He further detailed that three naira crude cargoes were allocated to the refinery in August, with five cargoes each scheduled for September and October.
As loading operations for September are currently underway, NNPC has successfully completed its crude loading for August, with two vessels now preparing for September’s loading.
Meanwhile, the Steering Committee of the Domestic Crude Oil and Refined Products Sales in Local Currency Initiative has reassured Nigerians that the issues surrounding the naira-for-crude arrangement have been amicably resolved. The committee, chaired by the Minister of Finance, Mr. Wale Edun, held a meeting over the weekend with representatives from various sectors, including the Central Bank of Nigeria and the Dangote refinery.
In a statement, the committee emphasized, “There will be no disruption in the supply of refined petroleum products across the country,” reaffirming the Federal Government’s commitment to energy security and stability in the domestic petroleum market.
This naira-for-crude initiative, introduced by President Bola Tinubu last year to address the crude crisis faced by the Dangote refinery, aims to ensure that locally produced crude is allocated to domestic refineries. Despite previous challenges, including Dangote’s reliance on imported crude due to low local supply, this new agreement is expected to bolster local crude sourcing.
Industry stakeholders have welcomed the agreement, viewing it as a pivotal step towards ensuring a steady supply of fuel in the local market. Hammed Fashola, Vice President of the Independent Petroleum Marketers Association of Nigeria, described the deal as a positive development that will enhance energy security in Nigeria.
“It will bring stability to the market,” Fashola noted, emphasizing the significance of maintaining local crude supply. Chinedu Ukadike, an IPMAN spokesman, echoed this sentiment, urging the government to also consider modular refineries in its domestic crude supply obligations.
As the NNPC and Dangote refinery move forward with this partnership, the focus remains on ensuring an uninterrupted supply of petroleum products to consumers across Nigeria. The government is also encouraged to address any existing conflicts within the industry to safeguard the nation’s economic stability.
