From Uche Usim, Abuja
The Nigerian National Petroleum Corporation (NNPC), yesterday disclosed that 128 companies participated in its technical bid tender for about 800,000 barrels of crude oil under the Direct Sales and Direct Purchase (DSDP) arrangement.
Speaking in Abuja at the formal bid opening, the Group Managing Director of NNPC, Dr. Maikanti Baru, said DSDP remains a major component of national oil company’s business, even as he assured Nigerians will not be left out in the deal.
His words: “Those companies that will emerge, whether as a consortium or single entities, must have physical presence in Nigeria. That means they must have depots or retail outlets as a minimum. They must be involved with exploration and production. So, we’ll ensure most of the proceeds are domiciled in Nigeria,” he said.
On the quality of fuel required, Baru said it would be based on West African Quality Specification.
The NNPC also explained that the DSDP arrangement has helped guarantee stability in petroleum products’ supply across the country.
“That aside, the DSDP has helped us achieve at least $500 million reduction in the amount we pay for demurrage on the supplied products. It also ensures the supply from refineries are augmented to meet national supply demand and also maintain 30 days sufficiency reserve, especially for petrol. The DSDP promotes transparency in the petroleum industry and the major instrument for its success in local and international market is meeting our obligation as supplier of last resort when products are not supplied to marketers.
“It has helped intervene in supply of regulated products like the ATK (Aviation Turbine Kerosene). When there was perceived shortage in the country, we intervened by bringing in cargoes almost on a weekly basis. So, we don’t have less than 30 days of ATK demand warehouse.
This is despite the propaganda of its unavailability. We’ve used DSDP in making supply of diesel sufficient. In one month, we delivered cargo (AGO) almost every four days. So, the market is wet with AGO (diesel).
“However, over one year, we’ve learnt lessons from the DSDP arrangement and we’ve taken cognisance of those and corrected them in the tender process to improve efficiency, transparency and accountability. We want to entrench measures to promote integrity in our entire operations. So, DSDP is good and will be fully guided by public interest and compliance with extant laws,” Baru stated.
Also speaking at the programme, the Group General Manager, Crude Oil Marketing Division, Mele Kyari, said the NNPC was strongly focused on shutting out corruption in its operations.
“Transparency and accountability are our watchwords. Again, products availability is key to survival of Nigeria. Nigeria depends on sales of crude oil to generate revenue and run the economy. So we have to optimise crude oil available in Nigeria by getting the best value for it. So there must be transparency in off takers. We’re determined to ensure efficiency in public procurement, and again, we’re responding to a volatile market.
“We advertised and people applied. What worries us is fraudsters. We receive all sorts of information for off-spec crude. We don’t do that. We don’t have joint crude oil and gas sales agent. So, beware of fraudsters. Nothing like processing fees for NNPC. Don’t let anyone deceive you. No one would influence this bid,” Kyari cautioned.