The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) on Friday rejected insinuations by the management of the Dangote Refinery that it was failing in its duty as the upstream regulator to effectively enforce the Domestic Crude Supply Obligation (DCSO).
Essentially, the Petroleum Industry Act (PIA) 2021, empowers the NUPRC to impose the local supply obligation on upstream operators, licensees and lessees with the power to mandate the allocation of a specified percentage of their produced crude oil and condensate for sale in the domestic market.
In a statement in Abuja, the NUPRC said that in the first six months of 2024, it facilitated the supply of 29 million barrels of crude oil to the Dangote Petroleum Refinery and Petrochemicals despite claims by the Dangote team that the regulator was complacent in enforcing crude supply to the firm.“
Consequently, the commission rejects insinuations that it has poorly enforced the domestic crude supply obligation,” the Gbenga Komolafe-led organisation stated.
The commission said that as part of its commitment to ensure the enforcement of section 109 of the Petroleum Industry Act, 2021 which provides among others, the domestic supply of crude to local refineries on a ‘willing buyer, willing seller’ basis, it ensured that nine refineries were supplied crude despite low oil production.Dangote Refinery had on Thursday raised concerns over the inability of the industry regulator to fully enforce the domestic crude supply obligation.“
Our concern has always been NUPRC’s reluctance to enforce the domestic crude supply obligation, and ensuring that we receive our full crude requirement from the Nigerian National Petroleum Company Limited (NNPC) and the International Oil Companies (IOCs),” the firm stated in a widely-circulated statement.
But the NUPRC stated that despite its efforts to enforce the crude oil obligations through the development of the DCSO framework, the Dangote Refinery was still accusing of weak enforcement.
The NUPRC stated that in an earlier letter issued by the Dangote Refinery to the commission’s chief executive, dated July 24, 2024, it had commended the regulator for its enforcement of the DCSO.“
Let me once again commend you and your team for the successful development of the domestic crude supply obligation framework.
This framework will lay the foundation for ensuring a stable and reliable supply of crude oil to local refineries,” the statement quoted the Chairman of the Dangote Refinery, Aliko Dangote, as saying in the letter.In all, the NUPRC said it has facilitated over 32 million barrels of crude oil supply to domestic refineries in the country.
