The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has ordered exploration and production (E&P) companies in the country to strictly adhere to the Crude Oil Supply Obligations for local refineries.
The Commission gave the directive in a letter dated February 2, 2025 signed by the Chief Executive Officer, Engr. Gbenga Komolafe, and addressed to exploration and production companies and their equity partners.
Citing Section 109 of the Petroleum Industry Act 2021, which provides for a stable supply of crude oil to domestic refineries to justify the commission’s latest stance, Komolafe stated that NUPRC would now begin to enforce the provisions of the Act and penalise defaulters.
The NUPRC chief stated: “Kindly note that the diversion of crude cargo designated for domestic refineries is a violation of the law, and the Commission will henceforth disallow export permits for such cargoes.
“All cargoes designated for domestic refining can only be altered with the express approval of the Commission Chief Executive. The above is for your strict compliance”, Komolafe stressed.
He recalled that the commission has already taken significant regulatory actions to enforce compliance with the Domestic Crude Supply Obligations, including developing and signing the Production Curtailment and Domestic Crude Oil Supply Obligation Regulation 2023, as well as creating the DCSO framework and procedure guide for implementation.
A statement issued by the commission’s Public Affairs Unit on the directive on Monday indicated that any changes to cargoes designated for domestic refining must be approved by its Chief Executive Officer.
It warned that it would deny export permits for crude oil cargoes intended for domestic refining if the E&P companies failed fulfil their local crude supply obligations.
Industry analysts believe that the latest order by the commission to the E&P entities may not be unconnected to complaints from local refiners, including the Dangote Petroleum Refinery, over the challenges they are facing in sourcing adequate crude supplies.
Available data from NUPRC, shows that Dangote refinery is expected to process 550,000 barrels per day and 17.05 million barrels per month in the first half of the year, a target which sources at the refinery confirmed had not been met by the E&P companies.
