NNPC finalizes winners of 2-year crude oil contracts

Nigeria has finalised the list of companies and countries that will take its coveted crude oil cargoes through 2023, according to six sources.

The 26 companies and 12 governments will have the right to sell and trade some of the more than 1.5 million barrels per day (bpd) produced by Nigeria, Africa’s top oil exporter, from 2021 to 2023.

One of the sources said, the winners would each have the right to purchase two cargoes annually. A total of 320,000 bpd was allotted to oil-for-fuel swaps that provide the bulk of the gasoline for the largest consumer in West Africa.

NNPC issued the tender for the contracts in September last year, but the process was delayed several times. One complication was the rehabilitation of the Port Harcourt oil refinery, which NNPC was working to finance with the backing of oil cargoes.

Crude oil contracts awarded in 2018 lasted for two years. A full list was never published, it included least 100 companies.

Roughly 90% of Nigeria’s foreign exchange and half its budget come from oil and gas exports. An oil price crash amid the COVID-19 pandemic, and production cuts as part of an agreement with the Organization of the Petroleum Exporting Countries and other producers severely constrained Nigeria’s revenues and helped push it last year into its second recession in four years.