The Federal Government has commenced the sale of crude oil and refined petroleum products in naira, effective October 1, 2024, the Ministry of Finance announced in a statement on X on Saturday.
The decision was made following a directive from the Federal Executive Council and a subsequent review by an implementation committee chaired by the Minister of Finance.
“The Minister of Finance and Coordinating Minister of the Economy announced that, in line with the Federal Executive Council directive, the sale of crude oil and refined petroleum products in naira has officially commenced as of October 1, 2024,” the ministry’s statement read.
It was further disclosed that a review meeting, chaired by the Minister of Finance, Wale Edun, on October 3, affirmed the commencement of this “Crude Oil and Refined Products Sales in Naira” initiative, with key stakeholders confirming its launch.
Last month, the Technical Sub-Committee on Domestic Sales of Crude Oil in Local Currency announced that the Federal Executive Council had approved the sale of crude to local refineries in naira and the corresponding purchase of petroleum products in naira. The plan includes the sale of 385,000 barrels per day (kbpd) of crude oil to the Dangote refinery, to be paid for in naira.
The government explained that the naira-for-crude initiative would help reduce pressure on the naira, eliminate unnecessary transaction costs, and improve the availability of petroleum products in the country.
The Special Adviser on Media to the Chairman of the Federal Inland Revenue Service (FIRS), Mr. Dare Adekanbi, confirmed last Sunday that the plan for the crude oil supply to the $20 billion Lekki-based Dangote refinery was still in place.
Despite this confirmation, some officials from the Dangote refinery and other refineries stated on Thursday that they were not aware if the naira-for-crude deal had been activated.
Officials from the Nigerian Upstream Petroleum Regulatory Commission, the Federal Ministry of Finance, and the Nigerian National Petroleum Company (NNPC) also declined to comment on the deal’s status.
In September, the government explained that the naira-for-crude initiative would help alleviate pressure on the naira, eliminate unnecessary transaction costs, and enhance the availability of petroleum products nationwide.
“Since then, the implementation committee chaired by the Minister of Finance and we, the technical committee, have worked intensely with NNPC and the Dangote refinery to finalise the modalities for the FEC approval,” stated Zaccheus Adedeji, the Special Adviser to the President on Revenue.
Adedeji further clarified that the Dangote refinery will supply petrol (PMS) and diesel to the domestic market in exchange for crude oil paid in naira. Diesel will be sold in naira to any interested buyers, while PMS will only be sold to NNPC, which will then distribute it to various marketers.
“All associated regulatory costs (NPA, NIMASA, etc.) will also be paid in naira,” Adedeji added. He also highlighted the creation of a one-stop shop to coordinate services from regulatory and security agencies for the smooth implementation of the initiative.
Key officials present at the October 3 meeting included Minister of State for Petroleum, Heineken Lokpobiri; Special Adviser to the President on Energy, Olu Verheijen; NNPC’s Group Chief Executive Officer, Mele Kyari; Dangote Group’s Vice President, and several other key figures in the petroleum and finance sectors.
