The Nigerian National Petroleum Company Limited (NNPCL) and Dangote Refinery are currently negotiating the renewal of their naira-based crude oil supply agreement, which is set to expire at the end of March 2025.
In a statement released on Monday, the NNPCL revealed this in reaction to rumours that the government-owned oil company had terminated the naira-for-crude agreement until 2030 because it had already forward-sold all of its crude oil.
The initial six-month contract, initiated in October 2024, aimed to address currency challenges by allowing NNPCL to supply crude oil to local refineries in exchange for naira. Under this arrangement, NNPCL has supplied approximately 48 million barrels of crude oil to Dangote Refinery.
Discussions are underway to establish a new contract, with details such as volume, pricing, and duration yet to be finalized.
NNPCL has clarified that the naira-for-crude policy remains in effect and has not been discontinued.
The Dangote Refinery, a $20 billion project located near Lagos, has faced delays and cost overruns but is now operational, producing diesel and jet fuel as of January 2024.
The refinery is expected to significantly reduce Nigeria’s reliance on imported refined petroleum products.
