NNPC cancels crude oil delivery contracts to refineries

The Nigerian National Petroleum Corporation on Thursday declared the dropping of the terms of agreement for the conveyance of unrefined petroleum to the refineries in Warri, Port Harcourt and Kaduna.

The enterprise additionally reported the end of the Offshore Processing Agreements with three organizations – Duke Oil Company Inc, Aiteo Energy Resources Limited and Sahara Energy Resources Limited. The understandings were fixed in January, 2015.

Under the assention, the NNPC designates an aggregate of 210,000 barrels of raw petroleum every day for refining at seaward areas in return for petroleum items at pre-concurred yield design.

The enterprise said the choice to drop the oil conveyance contracts to refineries was taken after a legitimate assessment of the agreement terms, including that the undoing was because of extravagant expense and unseemly procedure of engagement.

The firm said the new measures were gone for expense decrease and to reinforce operational productivity over its worth chain.

The organization noticed that as a stop-crevice measure, the NIDAS Marine Limited, a backup of the NNPC, had been locked in to give rough conveyance administration on an arranged industry standard rate.

The partnership, in an announcement issued by its Group General Manager, Group Public Affairs Division, Mr. Ohi Alegbe, said, "We have likewise initiated a thorough and straightforward procedure of securing proficient and focused foremen for the conveyance of raw petroleum by marine vessels to Port Harcourt and Warri/Kaduna refineries, pending the rebuilding of the unrefined pipeline framework."

The NNPC disclosed that it turned to the conveyance of raw petroleum to the refineries by marine vessels taking after perpetual assaults on the Bonny-Port Harcourt refinery pipeline and the Escravos unrefined pipelines by vandals and oil cheats, bringing about the complete inaccessibility of the pipelines in 2013.

On the OPA game plan, the firm said the present assention was not in light of a legitimate concern for Nigeria and the national oil firm, an improvement that prompted its scratch-off.

The firm said, "On the other hand, after nitty gritty examination of the operation and its terms of understanding, the NNPC is persuaded that the current OPA is skewed for the organizations such that the estimation of item conveyed is fundamentally lower than the comparable unrefined petroleum dispensed for the project."

The NNPC additionally watched that the structure of the understanding did not ensure unobstructed supply of petroleum items as conveyance terms were not ideal.

To address these failures, the NNPC said that it had initiated the procedure of building up option OPA taking into account ideal yield design with delicate preparing charges.

It said, "After due examination of execution direction, we have welcomed Messrs. Oando, Sahara Energy, Calson, MRS, Duke Oil, BP/Nigermed and Total Trading to offer for the new Offshore Processing Agreement while we have connected with AITEO, Sahara Energy and Duke Oil to leave the current OPA."

On the status of the unrefined for item trade assention, also called SWAP, which was allegedly gone into by the NNPC and some oil dealers, the organization educated that the last SWAP plan slipped by in December 2014 and was never restored.

The NNPC additionally expressed that it had gotten the authorization of President Muhammadu Buhari to kick-begin the tendering procedure for the 2015/2016 unrefined petroleum term contract for the clearing of Nigeria's raw petroleum value from the different rough and condensate creation game plans.

It noticed that the procedure, which would start with the promotion of the unrefined petroleum term contract in both national and universal print media for a time of one month, had been precisely organized to get rid of 'folder case organizations' and rent seeker

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