FG Saves $500m On Oil Products

The Group Managing Director (GMD) of the Nigeria National Petroleum Corporation (NNPC), Dr Maikanti Baru, on Thursday said the corporation saved 500 million dollars (N152.4bn) on oil products sales.

Baru disclosed at the opening of bid for the Direct Sale Direct Purchase (DSDP), at the NNPC Towers in Abuja.

The News Agency of Nigeria (NAN) reports that DSDP is a model introduced in 2016; carried out through direct sales of crude oil to refiners or consultants, who in turn supply NNPC with equivalent worth of products.

NAN also reports that 128 Indigenous and International Oil and Gas companies indicated interest to participate in the 2017 DSDP programme.

The batch over which the bids were opened is scheduled to last for the next one year, starting from April 1.

“The DSDP programme has also recorded significant cost savings of over half a billion dollars through major reduction in the amount we paid for both demurrage and the product themselves.

“It ensures that the supplies from refineries are fully augmented to meet the national supply as well as a sustained over 30 days sufficiency particularly with petrol.

“The programme is very transparent and the major instruments on the partnership between the NNPC and the product supplies both local and international, we have as part of this programme,” Baru said.

In an interview with newsmen on the sideline of the bidding process the GMD said the requirement was that the bidder must have physical presence in Nigeria.

“The major drive here is to ensure that Nigerians are not left out and to ensure that those that emerge, whether consortium or single, must have physical presence in Nigeria.

“That means they must have depots or retail outlets as a minimum or they must be involved with exploration or production of crude oil.

“So we will ensure that most of them are domiciled here in Nigeria. This year’s programme for DSDP is about 800, 000 barrels at most,” he said.

He said the tenders will be based on West African quality specifications and we will maintain the latest which is 50 per cent of sulphur content.

NAN reports that the corporation saved a billion dollars from the DSDP programme in 2016.