FG Releases New Rules To Compel Oil Producers To Sell Crude Oil To Domestic Refineries
The federal government through the Nigeria Upstream Petroleum Regulatory Commission (NUPRC) has introduced new regulations requiring its oil producers to sell crude oil to local refineries in a move to reduce the country’s dependence on imported refined products.
The new regulations mandate that all oil companies in Nigeria must supply crude to domestic refineries that are unable to procure it locally. Only after fulfilling these domestic supply commitments are producers permitted to export crude.
The NUPRC will serve as a middleman between local refiners and producers when agreements on crude supply cannot be finalized, helping to arrange a sales purchase agreement based on a willing-buyer, willing-seller model.
According to the regulations, payments for crude to domestic refiners can be made in dollars, naira, or a combination of both.
The regulator plans to implement the Domestic Crude Oil Supply Obligation initiative in the second half of the year. The specific quantity of crude each refinery is required to procure has not yet been determined.
Source: Nairametrics
