April 20, 2024
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OIL & GAS

Nigeria Addresses Challenges in Domestic Crude Policy

Nigeria’s oil regulator, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), convened a meeting with producers and local refiners to tackle challenges in implementing the Domestic Crude Oil Supply Obligation (DCSO) policy, the agency’s head announced on Tuesday.

According to Reuters, the DCSO policy, introduced under the petroleum industry law in 2021, aims to enhance local refining capacity and diminish dependence on imported fuels.

However, Gbenga Komolafe, chief of NUPRC, acknowledged obstacles hindering the smooth implementation of the policy, which could potentially affect national oil production targets.

Key concerns discussed during the meeting included discrepancies between existing contracts and the DCSO framework, delays in payment guarantee from refineries, and logistical issues such as last-minute vessel changes.

“Our aim is to identify and address these challenges effectively, with the ultimate goal of ensuring a seamless and efficient allocation process by the oil producers and off-take by the domestic refiners,” Komolafe said.

“Our priority is to uphold the integrity of the DCSO framework while fostering a conducive environment for the sustainable growth of Nigeria’s oil and gas industry,” he added, highlighting the meeting’s objective to address concerns raised by oil producers and refiners, especially Dangote Refinery, the country’s largest privately owned plant.

While a committee comprising industry representatives is working on a framework for smoother DCSO implementation, Komolafe stressed the necessity of direct engagement with oil company chief executives to resolve issues effectively.

He emphasized that “the buck stops on your desk” and underscored the regulator’s commitment to upholding the integrity of the DCSO framework while fostering sustainable growth in Nigeria’s oil and gas industry.

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