The Nigerian National Petroleum Corporation (NNPC) on Sunday disclosed that 15 oil firms comprising international companies and Nigerian downstream players have been selected to offtake crude oil and in return, deliver corresponding petroleum products of equivalent value (about 14 billion litres) to the corporation under the 2019/2020 Direct Sale, Direct Supply (DSDP) deal.
The Group Managing Director of the NNPC, Mr Mele Kyari, who made the disclosure in a statement, said the announcement of winners was consistent with its commitment to transparency and accountability in all its activities.
He explained that the winners emerged following a rigorous process that proved their financial buoyancy, experience and technical capacity to deliver to taste.
The contract, he added, is for one year effective October 1, to September 30, 2020.
The successful companies are: BP Oil International Limited/AYM Shafa Limited, Vitol SA/CALSON-HYSON, Totsa Total Oil Trading SA/Total Nigeria Plc, Gunvor International B.V./AY Maikafi Oil And Gas Co Ltd
Trafigura PTE Ltd and A.A Rano Nigeria Ltd. Others are Cepsa S.A.U./Oando Plc, Mocoh SA/Mocoh Nigeria Ltd, Litasco SA/BRITTANIA-U Nigeria Ltd LTD./Freepoint Commodities, MRS Oil & Gas Company Ltd; Sahara Energy Resource Ltd; Bono Energy Ltd./Eterna Plc/Arkleen Oil & Gas Ltd./Amazon Energy; Matrix Energy Ltd./Petratlantic Energy Ltd/UTM Offshore Ltd./Levene Energy Development Ltd, Mercuria Energy Trading SA/ Barbedos Oil & Gas Services Ltd./Rainoil Ltd./Petrogas Energy, Asian Oil & Gas PTE Ltd./ Eyrie Energy Ltd./Masters Energy Oil & Gas Ltd/Casiva Ltd and NNPC’s subsidiary, Duke Oil Company Incorporated.
Each of the aforementioned firms are to provide proof of financial liquidity of $72 million at the minimum, in addition to cognate experience in crude oil marketing and petroleum products import.
The release further explained that the tender process comprised technical and commercial bid submission respectively, evaluation and shortlisting, then commercial negotiations with pre-qualified companies and engagement of the successful consortia/companies by NNPC.
The NNPC received 132 bids for the 2019/2020 DSDP contract, unlike 128 received in 2018.
It notes that the scheme, since inception in April 2016, has ensured significant reduction in product demurrage cost up to 84 per cent and cost savings of about $2.2 billion.
About 39.6 billion litres of petroleum products (representing over 90 per cent of national requirement) have been supplied since the inception of the DSDP scheme from April 2016 to March 2019.
The scheme involves the enlistment of a robust supplier mix, comprising big international players and strong Nigerian downstream companies for supply flexibility and local capacity development.
The programme, according to the NNPC, was designed to plug loopholes recorded in previous Offshore Processing Arrangement deals.
In his takeover note on July 8 as NNPC GMD, Kyari promised to open NNPC books to public scrutiny, saying as a publicly-owned company Nigerians deserve to know about its day-to-day operations.
He also reiterated his management’s commitment to transparency and accountability when he had a maiden town hall engagement with the staff of the Corporation where he launched the team’s policy direction tagged: Transparency, Accountability, Performance and Excellence (TAPE).