After the Federal Ministry of Finance announced that the deal began on October 1, 2024, oil marketers and domestic refiners have challenged the Federal Government to reveal specifics regarding the naira-for-crude deal.

The Federal Government said on Saturday that it had started selling refined products and crude oil in naira.

The Petroleum Retail Outlet Owners Association of Nigeria and the Crude Oil Refinery Owners Association of Nigeria applauded the announcement, but the operators demanded that the government release more information regarding the agreement.

The program began on October 1, 2024, the government announced on Saturday. However, it did not elaborate on the specific terms of the inked deal or the product’s price.

This was revealed by the Ministry of Finance in a post on its X account.

According to the statement, “the sale of crude oil and refined petroleum products in naira has officially commenced as of October 1, 2024, in line with the Federal Executive Council directive,” was made public by the ministers of finance and coordination of the economy.

“Key stakeholders affirmed the start of this strategic initiative following a meeting of the Implementation Committee, chaired by the Minister of Finance, on October 3, 2024, to conduct a post-commencement review of the Crude Oil and Refined Products Sales in Naira initiative.”

Workers respond

The Nigerian Petroleum Retail Outlets Owners Association welcomed the initiative’s launch and said that the strengthening of the naira is important for all parties involved in the oil industry.

In an interview on Saturday, Billy Gillis-Harry, the President of PETROAN, encouraged the NNPC and other parties involved to make the agreement’s specifics public, particularly its pricing structure, in order to allay Nigerians’ concerns about a potential increase in fuel prices.

He declared, “I’m at my hometown right now because Rivers State elections are still going on. It was peaceful, just, and free. I will thus only begin to pay attention to the oil industry’s developments after the election.

“As an organisation, PETRONAN presented the case for selling crude oil to Nigerian refineries directly for naira.

“To add value to our proposal, we suggested that the government devise a policy that defies convention. We are pleased and proud of the current administration for putting that suggestion into practice.

“We hope that the public will learn the nuances of this deal as this business is the key value of all that happens in our economy,” he continued. “The contents of this arrangement are not known yet. As the price of the commodity is determined by the price of the petroleum, PMS is crucial.

Knowing the specifics and how it will be implemented will be very beneficial to us. Still, we are pleased with the agreement and commend all parties concerned.

Eche Idoko, the Publicity Secretary of the Nigerian Crude Oil Refinery Owners Association, praised the government for the initiative but was unable to offer any other information.

“Given the effect this action will have on domestic crude oil refining, it is a favourable development. We applaud the government for it, and we hope the agreement closes amicably.

“However, I don’t currently know all the information regarding the deal, therefore I can’t provide you any further details. Thus, additional information will be forthcoming, and it will be shared as needed. We applaud the administration overall for this.

The Federal Executive Council, led by President Bola Tinubu, has approved the sale of crude to local refineries in naira and the corresponding purchase of petroleum products in naira, according to a statement made last month by the Technical Sub-Committee on Domestic Sales of Crude Oil in Local Currency.

The committee had announced, “NNPC will begin the supply of about 385kbpd (385,000 barrels per day) of crude oil to the Dangote refinery to be paid for in naira as of October 1st.”

When asked last week if the arrangement for the crude oil supply to the $20 billion Lekki-based facility was still in place, Mr. Dare Adekanbi, the Chairman of the Federal Inland Revenue Service’s Special Advisor on Media, gave a similar positive response.

However, Dangote and other refinery officials said on Thursday that they had no idea if the agreement had started.

When asked for details on the naira-for-crude contract between NNPC and Dangote on Thursday, officials at the refinery, the Nigerian Upstream Petroleum Regulatory Commission, the Federal Ministry of Finance, and NNPC, among others, remained silent.

In September, the government gave an explanation of how the naira-for-crude project would help ease the strain on the naira, get rid of pointless transaction fees, and increase the country’s supply of petroleum products.

Adedeji had declared, “Since then, we, the technical committee, and the implementation committee led by the Minister of Finance have worked tirelessly with NNPC and Dangote refinery to fashion out the details of the modalities for the implementation of the FEC approval.”

The committee chairman and head of FIRS stated that starting on October 1, oil would be sold to Dangote in naira. He further stated, “In return, the Dangote refinery will supply PMS (petrol) and diesel of equivalent value to the domestic market to be paid in naira.”

The Dangote refinery will sell diesel to any interested off-taker in naira. NNPC will be the exclusive buyer of PMS. Then, NNPC will sell to several marketers in the meantime. NPA, NIMASA, and other related regulatory fees shall all be paid in naira. To guarantee a seamless rollout of this program, we are also establishing a one-stop shop that will coordinate service provision from all regulatory agencies, security agencies, and other stakeholders.

However, the government said on Saturday that the agreement had started in a statement released by the ministry of finance. It stated this was after a meeting with relevant parties involved in the sale.