254 firms bids for purchase of Nigerian crude grades

Nigerian National Petroleum Corporation, NNPC headquarters are seen in Abuja

Two hundred and fifty four firms are currently jostling to win the juicy contract of crude oil lifting for 2018, midwifed by the Nigerian National Petroleum Corporation (NNPC).

The contract entails lifting about 40 cargoes of crude oil monthly, which translates to 480 cargoes annually.

The Group Managing Director of NNPC, Dr Maikanti Baru, who disclosed this yesterday in Abuja at the official bid opening ceremony of the 2018/2019 crude oil term contract, also announced that Nigeria’s crude oil production has hit 2.1 million barrels per day (mpd) with condensates and 1.8 mpd without condensates.

Recall that last year, 39 winners with 18 Nigerian companies, 11 international traders, five foreign refineries, three National Oil Companies (NOCs) and two NNPC trading arms, out of 224, got the nod for the deal.

Under the 2017 deal, all the contracts are for 32,000 barrels per day except Duke Oil Ltd, an oil trading arm of the NNPC, which was for 90,000 barrels per day.

Baru said the entire process would be transparent, just as all the details of the owners of beneficiary companies will be known and properly documented.

“Constitutionally, we don’t deal with directors and owners of prospective bidding companies with questionable character. We avoid that and, as such, we scrutinize thoroughly”, he said.

Baru said the NNPC, as a national oil company, was determined to enhance production volumes, while ensuring that the best value was realized through competitive marketing of the nation’s core crude grades to international refineries and traders.

He also revealed that the NNPC was deeply collaborating with key stakeholders to improve the security of production sites, crude oil export lines and other critical oil and gas infrastructure.

While warning prospective bidders to be wary of fraudsters, the NNPC boss emphasized that crude oil term contract was not a procurement contract , but a process of selecting partners for the sale and procurement of NNPC equity crude oil volumes.

“Over the years, we have established processes that have enabled the engagement of the best partners and guaranteed full automation and recovery of the full value of all crude oil lifted.

“We have also promoted greater participation of Nigerian enterprises while preserving world-class standards”, he said.

On fuel supply, the NNPC boss regretted the scathing scarcity that marred the yuletide celebrations, assuring that such measures were in place to avoid a reoccurence.

He heaped the blame on those he described as bad eggs wanting to profiteer at the expense of Nigerians’ well being.

Also speaking at the event, Mele Kyari, Group General Manager, Crude Oil Marketing Division of the NNPC said the selection of the off-takers would be transparent and in strict adherence to the dictates of the Bureau For Public Procurement.

“That is with regards to transparency and due process.

“Again, you must now disclose the owners of the company. Prospective bidders must have a turnover of at least $500 million and a networth of $250 million because we’ll leave our crude with you for 30 days and we have to ensure you can deliver no matter what.

“So, we’re going to select partners. We’ve had our cargoes stranded in the past and so we want to ensure it won’t repeat itself…”