Dr Maikanti Baru, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), says Nigerian crude oil is not an abandoned commodity.
Baru said this while addressing newsmen after declaring open the 2016/2017 bid for crude oil grades.
According to him, the nation’s crude is not struggling or stranded but remains a hot cake in the oil market.
“Nigerian crude has continued to earn premiums and it is 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 produce from crude oil. Nigerian crude oil continues 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 crude end up in European refineries.’’
Baru also dismissed as false, the report that the corporation operated a separate crude account.
He said the corporation operated a transparent system to ensure fairness in all transactions.
“There is nothing that is hidden. It is done open for everybody to see as it is seen today. That is what we do in all our tenders.
“When we sell this crude, the money goes straight to the Central Bank of Nigeria (CBN) account on behalf of the Federation and the nation.
“NNPC does not operate any of those accounts. The best input that comes to NNPC is confirmation that the money has been paid; but we have no signature rights on these accounts.
“This is contrary to the perception of several people that NNPC is withholding some money for and on behalf of the Nigerian people.
“All the crude that we sell goes to the Nigerian people. This event is to show the agenda of the President as far as transparency and accountability are concerned,’’ he said.
On volume gotten from joint venture operations, Baru said it was about 600,000 barrels per day when activities were in full swing.
“We also have somewhere in the region of 100,000 barrels per day in terms of royalty and various tax oils that is released from the PSC operations.
“These are the kind of volumes that we are expecting from next year.
“Today’s event marks yet another turning point in our quest to further enshrine transparency and accountability, two critical core values of our corporation, he said, adding that: “Our focus as a national oil company is to enhance our production volumes, heensure the best value is realised through competitive marketing of our crude grades to international refineries and traders.
“In line with this aspiration, NNPC is collaborating with key stakeholders to improve on the overall security of our production sites and to ensure the safety of our environment. Today, we are therefore opening this bid before the entire world in line with President Muhammadu Buhari’s drive for transparency and accountability in the conduct of government business.
Earlier, Mele Kyari, Group General Manager, Crude Oil Marketing Division, while giving account of the sales of the crude, dismissed reports that only China was buying Nigerian crude.
He said China bought one cargo but Europe remained the major buyer followed by Asia, adding that “on global oil prices, he explained that the major challenge was that supply continued to exceed demand.”
This, he said, would continue to affect the oil price in a couple of years to come.
SOCA oil, Bell point and Northwest were called to the stage to confirm their bids and they all confirmed it was intact.
He, however, could not give a specific number of companies that would be selected, saying “that would be decided on actual production forecast around February, when the tenders are supposed to come in.
However, last year, we had about 27 companies that were selected’’.
Bidders include ENI, Forte, SOCA, Bangbang B, Northwest and Bellpoint.
A representative of Bellpoint, who prefered anonymity, told NAN that he was impressed with the process.
“It is a transparent process. At least you can tell from the higher number of bids this year, 224 as against 218 at the last exercise in 2015/2016.’’
NAN reports that the current bid is based on available volume, not field-by-field and there are 27 crude grades on offer.