The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) says several upstream oil producers resisted the government’s directive mandating them to allocate a portion of their output to local refineries.
In its 2024 annual report, the commission said producers submitted formal letters requesting waivers or offering reasons they might not meet the mandated domestic supply volumes.
The report was obtained from the NUPRC’s website on Friday.
“The Commission received several pushbacks from IPPG, OPTS, some producers and their equity partners via formal letters, either requesting for waivers on the allocated monthly obligations, or giving detailed explanations why they might not be able to meet up with the allocated volumes etc. (August 16th, 2024),” the report reads.
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The NUPRC said it facilitated the delivery of crude to Dangote refinery and other domestic processors in February 2024, using its monthly production curtailment platform.
According to the report, a working committee was set up with representatives from the NUPRC, Oil Producers Trade Section (OPTS), Independent Petroleum Producers Group (IPPG), and the Crude Oil Refinery-Owners Association of Nigeria (CORAN).
The panel was tasked with developing a comprehensive framework for implementing the domestic crude supply obligations (DCSO) policy.
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The commission said it developed a metric-based allocation model that considers each producer’s operational capacity — past, present, and forecasted — and would issue corresponding daily supply obligations bi-annually.
The report noted that the DCSO guidelines, based on a jointly developed operational template, were adopted by the commission but rejected by stakeholders.
“Meeting with the Permanent Secretary, Ministry of Petroleum Resources and other relevant stakeholders in the industry towards the implementation of domestic crude supply obligations (Sept 2nd, 2024, at the NNPC towers),” the report further reads.
“Following several complaints from operators about the presence of refiners at curtailment meeting, another letter was sent to refiners, notifying them of the Commission’s decision to put all refiners’ attendance at the monthly Production Curtailment Meeting (PCM) on hold temporarily till further notice (Sept 13th, 2024).”
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The NUPRC said it received a status update from the Nigerian National Petroleum Company (NNPC) Limited, through its subsidiary, NNPC Trading Ltd (NTL), on crude supply to Dangote refinery on September 20, 2024.
Despite the setbacks, the NUPRC said it continued to facilitate crude allocation to local refineries.
The commission said it also ensured transparency by publishing relevant data on its website and in three national newspapers on July 1, 2024 and January 1, 2025, in line with regulatory requirements.
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