Nigeria Saved $336m in Revoked Oil Swaps

Nigeria Saved $336m in Revoked Oil Swaps

The Nigerian National Petroleum Corporation (NNPC) has saved the country $336.4m between April and July of 2016 by stoping the controversial contract for petroleum product import called crude oil swap, Daily Trust reported.

In April NNPC had replaced the offshore processing arrangement (OPA) and crude oil swap contracts, through which it imports petrol to the country, with the direct sale direct purchase (DSDP) arrangement, according to The Nation. Through its publication, Energy in Brief, NNPC stated that the new DSDP framework ensured supply of refined fuel and saved a monthly average  of $53m.

NNPC in 2010 initiated the swap and OPA to import white fuels because domestic refineries could not meet local daily demands. The country lost an estimated $966m in the deal between 2009 and 2012, as the government later discovered that most of the bidders who participated in OPA were middlemen and not direct owners of refineries.

This news came as Nigeria seeks to revive the country’s economy through the sale of oil and gas assets, a decision that met with much objections by Nigerian citizens. Egypt Oil&Gas previously reported in September that Nigeria’s Trade Union Congress (TUC) had vowed to mobilize Nigerians and resist the sale or concession of the Nigeria Liquefied Natural Gas Company Ltd. (NLNG). Moreover, the country’s Petroleum and Natural Gas Senior Staff Association (PENGASSAN) had also threatened to shut down the country if the federal government carried out its plan to sell national oil and gas assets.

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