Nigerian crude oil still ‘hot cake’ in global market – NNPC GMD

Photo credit: Bloomberg
Photo credit: Bloomberg

Maikanti Baru, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), says Nigerian crude oil is not an abandoned commodity.

Mr. Baru said this on Thursday while addressing journalists after declaring open the 2016/2017 bid for crude oil grades.

According to him, the nation’s crude is not struggling or stranded but remains a “hot cake” in the oil market.

“Nigerian crude has continued to earn premiums and it is hot cake all over for refiners because of the light nature of the crude.

“It induces very high yields on the valuable products that you produce from crude oil. Nigerian crude oil continues to maintain market.

“In fact, contrary to a lot of speculation that a lot of Nigerian crude goes to China, they do not.

“Most of them are consumed and refined in India and Europe, particularly this year and last year; most of Nigerian crude end up in European refineries.’’

Mr. Baru also dismissed as false, the report that the corporation operated a separate crude account.

He said the corporation operated a transparent system to ensure fairness in all transactions.

“There is nothing that is hidden. It is done open for everybody to see as it is seen today. That is what we do in all our tenders.

“When we sell this crude, the money goes straight to the Central Bank of Nigeria (CBN) account on behalf of the Federation and the nation.

“NNPC does not operate any of those accounts. The best input that comes to NNPC is confirmation that the money has been paid; but we have no signature rights on these accounts.

“This is contrary to the perception of several people that NNPC is withholding some money for and on behalf of the Nigerian people.

“All the crude that we sell goes to the Nigerian people. This event is to show the agenda of the President as far as transparency and accountability are concerned,’’ he said.

On volume received from joint venture operations, Mr. Baru said it was about 600,000 barrels per day when activities were in full swing.

“We also have somewhere in the region of 100,000 barrels per day in terms of royalty and various tax oils that is released from the PSC operations.

“These are the kind of volumes that we are expecting from next year,” he said.

He, however, could not give a specific number of companies that would be selected, saying “that would be decided on actual production forecast around February, when the tenders are supposed to come in”.

He said last year, 27 companies were selected.

Bidders include ENI, Forte, SOCA, Bangbang B, Northwest and Bellpoint.

A representative of Bellpoint, who preferred anonymity, told NAN that he was impressed with the process.

“It is a transparent process. At least you can tell from the higher number of bids this year, 224 as against 218 at the last exercise in 2015/2016,” the representative said.

NAN reports that the current bid is based on available volume, not field-by-field and there are 27 crude grades on offer. (NAN)


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  • MO the Observer

    correct…. GEJ time was darkness, no transparency