The federal government of Nigeria appears to have bowed to pressure from domestic crude oil refiners like Dangote Refinery and Petrochemical Plant and other modular refinery operators in the sector and has given approval for them to have the option to pay naira or dollar for crude oil.

The government made this disclosure through the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) at a briefing in Abuja, where it unveiled the new template for domestic crude oil supply obligation.

It would be recalled that the Crude Oil Refinery Owners Association of Nigeria had been mounting pressure on the federal government to demand that crude oil be sold to them in the domestic currency as they were facing increasing challenges in accessing FX stating that they may be forced to close shop if nothing was done to ameliorate the situation.

The Publicity Secretary of the association Eche Idoko had lamented that the purchase of crude oil in dollars is currently the major challenge to modular refineries while disclosing that they buy crude in dollars and sell refined products in naira which they described as a major challenge.

And apart from that, where do you get the dollars to pay for the crude? You heard the Manufacturers Association of Nigeria crying out recently about the dollar saga. We have requested that crude oil be sold to us in naira. And when you do this, you ease the pressure on the naira and this will make our diesel cheaper.

“It will encourage more investors to build and patronise the local refineries. If you take petroleum products off the foreign exchange market, you would have helped the naira by 60 per cent,” he had said.

Reacting to this at a press briefing in Abuja, the Executive Secretary\Chief Executive Officer, NUPRC, Engr Gbenga Komolafe disclosed that based on the provisions of Section 109 (2) of the Petroleum Industry Act 2021, the NUPRC in a landmark move, had developed a template guiding the activities for Domestic Crude Oil Supply Obligation which was arrived at in conjunction with relevant stakeholders from NNPC Upstream Investment Management Services, representatives of Crude Oil/Condensate Producers, Crude Oil Refinery-Owners Association of Nigeria, and Dangote Petroleum Refinery came up with the template for the buy-in of all.

Komolafe stated that, as approved in the new template, payment for crude would be either in naira or dollar, adding that naira transactions would free the pressure on the country’s foreign exchange rate.

The NUPRC boss also pointed out that the template had become effective because all necessary parties had signed up for it.

He said, “The PIA intends to make the implementation (of crude oil obligation) very easy for the parties, both for the producers and refineries. So the answer simply is that the currency for the transaction would either be in naira or dollar. That is the simple answer.

“But we all know that if the transaction is carried out in naira, that itself will free the pressure on the exchange rate. That will help the exchange rate. So that is the intent and besides, the overall intent of the Petroleum Industry Act is to develop our midstream, which is a very laudable provision of the PIA.”

In the currency of payment section of the new template, it was stated that, “The payment shall be in either United States dollar or naira or both. Where the payment is in both currencies, the payment split shall be as agreed in the SPA between the producer and the refiner.”

The OPEC+ oil producers group is eyeing Namibia for possible membership as it sets up what could be Africa’s fourth-largest output by the next decade.

An African industry official and sources said on Tuesday.

TotalEnergies (TTEF.PA), opens new tab and Shell (SHEL.L), opens new tab in recent years have made discoveries estimated at 2.6 billion barrels, setting the stage for the southern African country to plan production from about 2030.

The initial focus for OPEC+ would be to see Namibia join its Charter of Cooperation, the sources said, a grouping that engages in longer-term dialogue about energy markets.

Eventually OPEC, the core oil exporters group that with Russia and others forms OPEC+, would like to see Namibia become a full member, said NJ Ayuk, executive chairman of the African Energy Chamber.

This Ayuk said had been involved in facilitating talks between the two sides.

OPEC had begun its “charm offensive,” he said, adding that the outcome of the talks were unclear at this stage.

OPEC did not immediately respond to a request for comment.

OPEC Secretary-General Haitham Al Ghais was quoted in February as saying OPEC was holding talks with several nations on joining the charter, without naming them.

OPEC in a tweet at the time said Al Ghais met Namibian Minister of Mines and Energy Tom Alweendo at a conference in Nigeria where the prospect of OPEC and Namibia working together “under the umbrella of the charter of cooperation” was raised.

In 2023, Namibian Petroleum Commissioner Maggy Shino expressed interest, opening a new tab in joining the OPEC “family,” according to a report by S&P Commodity Insights, known as Platts.

Yet in March, Minister Alweendo said that OPEC membership was not on the cards and did not want to be drawn on whether Namibia was considering joining the charter.

“We haven’t been approached by anyone to join OPEC. OPEC members are petroleum exporting countries and we are not there yet,” he said.

“That is a consideration only after we have started to produce,” Alweendo added.

Talks between OPEC and the Namibian government will likely continue in late April, however, when OPEC’s Al Ghais is scheduled to deliver an address to a Namibian energy conference, said Ayuk, who is also a speaker at the event.

About 2.6 billion barrels of oil have been discovered in Namibia this decade so far, Pranav Joshi of energy consultancy Rystad Energy told Reuters.

In addition to Total and Shell, firms including Chevron (CVX.N), opened a new tab, Rhino Resources, Eco Atlantic Oil & Gas and Galp Energia (GALP.LS), opened a new tab conducting exploration and appraisal activities.

Based on the existing discoveries, Namibia is looking at 700,000 barrels per day (bpd) of peak production capacity by the next decade, Joshi estimated.

That is smaller than Angola’s output of some 1.1 million bpd but Joshi noted Namibia’s number could rise with further successful exploration.

Angola had quit OPEC in December of 2023 over a lower-than-expected output ceiling it received from OPEC+ whose members are curbing production to help support prices.

Ten years after its initial public offer (IPO) which was held in 2014, Seplat Energy has generated $1.7 billion in free cash flow and invested over $57million to support community projects focused on healthcare, education and empowerment.

These were disclosed by Chief Executive Officer, Seplat Energy, Roger Brown, at a press briefing marking the oil company’s 10-year anniversary of dual listing at the Nigerian Stock Group (NXG) and the London Stock Exchange (LSE) in Lagos on Thursday.

Free cash flow is defined as “the money a company has left over after paying its operating expenses (OpEx) and capital expenditures (CapEx),” according to Investopedia.

Brown explained that Seplat Energy has made a significant progress post-IPO, acquiring eight onshore blocks in the Niger Delta and generating an average annual FCF of $264m.

With over 500 direct staff, the company, now known as most successful indigenous energy company in Nigeria, has supported hundreds of jobs indirectly in communities and the supply chain.

“Our success story driven by operational excellence, strong partnerships and credibility in international capital markets,” Brown told journalists.

At a point when firms evade and avoid taxes, Seplat Energy has made enormous contributions to the growth of the Nigerian economy.

Post-IPO, it has paid $2 billion in taxes to the Nigerian government since 2014.

Throwing light on this major stride, Eleanor Adaralegbe, Seplat Energy’s Chief Financial Officer-Designate, said the company has made a total of $2.8bn contribution in taxes and royalties to the Federal Government over the past 13 years.

The company’s contribution, according to her, include $1.54 billion paid in royalties; $329m of petroleum profits tax, and $273m on value added tax (VAT).

Others are: $259m of withholding tax, $126m of Pay As You Earn (PAYE), and $276m to the Niger Delta Development Commission (NDDC), among others.

In 2014, Seplat Energy made its intentions clear to become a major oil company in Africa’s most populous nation. As a result, it embarked on a landmark IPO, raising over $500 million on the LSE and the NGX.

Ten years after, Seplat Energy has returned $575 million to shareholders, meaning that shareholders gained additional $75 million as return on their investment. Core dividend to shareholders increased by 20 percent in 2023 to S$12c per share.

“With $575m paid as dividends since our IPO in 2014, we have successfully returned all the capital we raise at IPO,” she noted.

“Dividend has been paid in nine out of past 10 years,” she said, stressing that the main reason for reduced dividend in 2016/17 was the unavailability of infrastructure, particularly the Forcados, which went  offline for 16 months.

Seplat Energy acquired Eland Oil & Gas, which was the first acquisition of a United Kingdom-listed company by a Nigerian firm in December 2019. Eland had held participating interests in OML 40 and the Ubima marginal field.

The Eland investment followed earlier acquisitions such as Belema Oil Producing (an energy exploration outfit) in February 2015 and Assa North-Ohaji South (ANOH) Gas Processing (an energy refining company) in March 2019.

In June 2013, Newton Energy, a wholly-owned subsidiary of Seplat, reached an agreement with Pillar Oil to acquire a 40% participating interest (non-operated) in the Umuseti/Igbuku fields (OPL 283).

Also in 2015, the group purchased a 40 percent participating interest in OML 53, onshore north-eastern Niger Delta, from Chevron Nigeria Ltd and had a revenue interest in OML 55, south-eastern Niger Delta.

In January 2017, Seplat incorporated a new subsidiary, ANOH Gas Processing Company (AGPC) Limited, a midstream gas company committed to the processing of gas from OML 53 for onward distribution to the local market. In August 2018, the group entered into a shareholder agreement with Nigerian Gas Processing and Transportation Company (NGPTC) to subscribe for equal ownership of AGPC.

The Seplat Energy portfolio now comprises eight oil blocks – direct interests in seven blocks in the Niger Delta area, four of which Seplat operates and one further of revenue interest. The company also established a robust Global Memorandum of Understanding with the local communities in the Niger Delta, setting out rules of engagement and mutual beneficiation.

The major effect of these acquisitions has been to position the company as the leading partner for Nigerian domestic gas supply for the power sector and a significant contributor to the crude supply to the export markets.

They also culminate in delivering key performance indicators such as 478 million barrels of oil equivalent (MMBOE) in 2P reserves, 47,758 barrels of oil equivalent per day (BOEPD) production capacity, adjusted revenue of $1.06 billion, adjusted EBITDA OF $448 million and share value of GBP867.96 million (N1.98 trillion) recorded as at its last reporting period in December 2023. The company has about 588 million shares outstanding on the Nigeria Exchange.

“We are a leading supplier of gas to Nigeria’s domestic gas-to-power market. At times, our gas powered 25-30 percent of Nigeria’s domestic grid,” Brown said.

He explained that the company has over $800million available liquidity and credible access to global capital markets

He added that Seplat Energy has emerged as a strong voice and a thought leader in the African energy landscape.

“We have diversified Seplat Energy investor base, enhancing relationships with current and potential investors across the world.”