Crude Oil Swap: Firms agree to pay $184 million to Nigerian govt

Crude oil extraction [Photo credit: Bloomberg]

Three crude oil marketing firms on Thursday agreed to pay over $184 million for under-delivery of crude oil recorded under the former petroleum product swap regime, the Nigerian National Petroleum Corporation, NNPC, has announced.

Under the swap arrangement, the NNPC allocated crude oil to trading companies in exchange for processed petroleum products.

The Group Managing Director of the Corporation, Maikanti Baru, said the repayment agreement was arrived as part of ongoing reconciliation process with the three companies, namely AITEO Energy Resource Limited, Ontario Oil and Gas Limited and Televaras Group of Companies.

The NNPC, which confirmed the settlement in a statement, said at the end of the reconciliation exercise that Taleveras committed to an initial settlement of $17.2 million payment within two weeks, and a further payments in $10 million tranches later.

Ontario also agreed to pay $10 million, although the NNPC did not say how much AITEO agreed to pay.

‘’We have engaged them and positively. So far AITEO has been very cooperative and we had extensive reconciliation across all our chains of businesses where they are involved,” the Group Managing Director of the NNPC, Maikanti Baru said.

He said Televaras agreed to make a tranche payment of $17 million, while Ontario has also agreed to come to the table with our team and present their repayment schedule.

Mr. Baru commending the three companies involved in the crude oil swap for coming forward to reconcile their accounts and agreeing on a settlement plan to bring the long standing matter to a closure.

The GMD said the ongoing debt recovery process was geared towards probity and accountability in the operations of the Corporation in line with current reforms in the industry.

Only last week, the NNPC announced aggressive measures to achieve full recovery of over 130 million litres of petrol stored in the facilities of two indigenous downstream operators, MRS Limited and Capital Oil & Gas Limited, under a throughput arrangement to ensure a robust strategic reserve.

Providing details of the infraction by the companies, NNPC Chief Operating Officer, Henry Ikem-Obih, Downstream explained that the violation was discovered earlier in the year.

Mr. Ikem-Obih said when the Corporation need to access the over 100 million litres of petrol stored at the Capital Oil & Gas depot for NNPC Retail and over 30 million litres in MRS Limited depot all in Apapa area of Lagos, it was discovered that all the stock had been sold without due authorization.

He said though MRS had fully complied by returning the 30 million litres of petrol it expropriated, the Corporation was working assiduously to recover from Capital Oil & Gas the 82 million litres of petrol, valued at N11billion, out of over 100 million litres.

Mr. Baru said its management was determined to recover the missing products from the company.

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