Nigeria is set to finally end crude oil swap deals in March according to an article from Reuters. It will be replaced with “Direct Sale-Direct Purchase system that will now have the NNPC directly sell crude oil to refiners and purchase refined oil products from them.
President Muhammadu Buhari on 13th August cancelled the controversial offshore processing and oil swap deals initiated in January this year by the outgoing administration of Dr. Goodluck Jonathan.
The Nigerian National Petroleum Corporation (NNPC) the confirmed in November that it would stop the controversial swap agreements. NNPC Spokesman said on Tuesday that the DSDP arrangement will save Nigeria about $1 billion as all the cost associated with middlemen will now be saved.
“The crude-for-products exchange arrangement popularly referred to as crude swap will be replaced by a Direct-Sale-Direct-Purchase (DSDP) arrangement which would take off next month,” NNPC spokesman Ohi Alegbe said on Tuesday.
“The minister stated that the DSDP option eliminates all the cost elements of middlemen and gives the NNPC the latitude to take control of sale and purchase of the crude oil transaction with its partners, adding that the initiative would save $1 billion for the federal government,”