NNPC issues 2016 Crude Oil Contracts Worth $13.5B

The Nigerian National Petroleum Corporation (NNPC) has issued its 2016 crude oil term contracts to 21 companies, going directly to international refineries, trading houses and local downstream firms, according to a list obtained by Reuters.
   
The contracts cover 991,000 barrels per day (bpd) of oil, worth $13.5 billion at current crude oil prices, which is roughly half of Nigeria's crude oil production of around 2 million bpd.

The list includes refiners such as Spain's Cepsa, Italy's Saras, India's IOC and ENOC of the United Arab

Emirates, as well as trading houses Trafigura, Mercuria and Vitol and international oil companies ENI, Total, Exxon and Shell.
   
The remainder are Nigerian downstream and NNPC trading companies.

In a statement, NNPC said: "Apart from ensuring transparency, the companies were carefully chosen based on their track records and trading experience to ensure that Nigerian crude cargoes are not left unsold."

The list is pared down from the final 2015 contract list, which comprised 43 companies and did not include any global traders. Many of the mostly local companies included then were criticised by international watchdog groups, such as the Natural Resource Governance Institute (NRGI), as "unqualified intermediaries" who added little value.

President Muhammadu Buhari is on a campaign to root out corruption in the NNPC and oil theft across the nation, which he assesses at about 250,000 bpd.

During a televised launch of the contract process in October, when 278 companies submitting bids for crude oil contracts, NNPC officials promised to slash the number of winners and conduct business differently.

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