The Nigerian National Petroleum Company Limited, NNPC Ltd., says it is sustaining crude oil supplies to the Dangote Refinery under the Federal Government-approved naira-for-crude arrangement.
Group Chief Executive Officer of NNPC Ltd., Bayo Ojulari, after the company’s Annual General Meeting, said that NNPC supplies a specified number of crude cargoes to the refinery in naira, while additional available volumes are supplied in US dollars.
Ojulari explained that the dollar-denominated transactions were necessary because most of NNPC’s financial obligations, including payments to drilling and project contractors and operators, were denominated in dollars.
“Most of our commitments are in dollars, so there is no point receiving naira and then going to buy dollars to meet those obligations,” he said.
He added that NNPC had a commitment to supply a specific number of crude cargoes in naira, while any additional crude volumes available would be supplied in dollars.
Ojulari said the company would continue to honour the Federal Government-approved naira-for-crude arrangement while supplying additional available crude volumes in dollars.
On crude oil theft and pipeline security, he said the combined efforts of community-based surveillance, intervention measures and security agencies had significantly improved the availability of major crude oil pipelines.
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According to him, pipeline availability, particularly along major export routes, had improved substantially from levels recorded in early 2024, when some facilities operated at less than 10 per cent of producers’ reported output.
He said some producers were now reporting that they could deliver virtually all their production to terminals, indicating improved reliability across major pipeline networks.
Ojulari also said the reconciliation rate between crude produced by operators and volumes accounted for at terminals had improved to about 90 per cent, compared with between 10 per cent and 20 per cent previously.
He, however, noted that challenges persisted on smaller internal pipelines and at wellheads, particularly those located in difficult terrains.
The NNPC GCEO said the company was deploying technologies, including fibre optics and high-technology wellhead cages, to detect intruders and improve response to crude theft and pipeline breaches.
While detection had improved significantly, he said the speed of response remained an area requiring further attention, especially for facilities located in remote areas.
Ojulari said NNPC was therefore shifting greater attention to smaller pipeline networks and thousands of wellheads across land, swamp, seasonal swamp and shallow offshore terrains.
“We are looking at what additional technology we can put in place to support our operations in those areas,” he said.
NAN
