Fidelia Okafor

The bid process for the sale and purchase of Nigerian crude oil grades, would be concluded by February 2017.

The Nigerian National Petroleum Corporation, NNPC, gave this assurance at the opening of the bid in Abuja.

At the opening, 224 companies showed significant interest to trade about 700,000 barrels per day of various grades of Nigeria’s crude oil put on offer for the 2017 fiscal year.

Group Managing Director of Nigerian National Petroleum Corporation, NNPC, Mr. Maikanti Baru, disclosed that the number of companies bidding dropped from 278 in 2015/2016 to 224 at present, due to the strengthening of the criteria for prospective bidders.

He disclosed that the NNPC was targeting crude oil refiners, big oil traders, as well as companies that had made substantial investments in the Nigerian oil and gas industry, particularly in the downstream sector.

Baru further stated that the huge number of bidders, despite the stringent conditions, was an indication of the fact that Nigeria’s crude oil grades were in high demand across the globe.

He said: “There have been those speculations that we are struggling for market. That is not true. Nigerian crude have continued to earn premiums and they are hot cake all over for refiners. Because of the light nature of the crude, it induces very high yields on the valuable products that you produced from crude oil. Nigerian crudes continue to maintain market.

“In fact, contrary to a lot of speculation that a lot of Nigerian crude goes to China; they do not. Most of them are consumed and refined in India and Europe, particularly, this year and last year, most of Nigerian crudes end up in European refineries.”

Commenting on the volume of crude oil on offer, The NNPC chief executive also stated that about 600,000 was expected from Joint Venture operations, while about 100,000 would be got from Production Sharing Contracts, PSC, in terms of royalty and various tax oils.

In addition, Baru stated that the significance of the bid opening was that it marked the beginning of the 2016/2017 term contract tender for Nigerian crudes under the NNPC on behalf of the government and people of Nigeria.