Adedapo Adesanya
By Adedapo Adesanya
The Nigerian National Petroleum Corporation (NNPC) has given companies interested in its direct-sale-direct-purchase (DSDP) contracts till January 21, 2021, to express their interests.
The national oil company stated that all interested companies are expected to register interest by December 22 and submit the necessary documents by the deadline.
The NNPC flagged off the 2020/2021 tender process under the DSDP programme earlier this month, requesting submission of tenders for fuel supplies in the country.
The DSDP agreement is a type of swap programme whereby a certain amount of crude is exchanged in return for the equivalent amount of refined petroleum products. It typically lasts for a year and the first DSDP agreement was signed between the corporation and 10 oil companies in May 2017 and expired in June 2018.
This means, under the programme, NNPC will provide monthly crude oil-free on board (FOB) cargoes to suppliers who are expected to provide petroleum products in return.
This is, however, open to the eligible company who have ticked some criteria which include: foreign refinery owners capable of processing Nigerian crudes with a Nigerian affiliate or subsidiary, globally established traders with Nigerian affiliates or subsidiaries, and indigenous companies working in the downstream with trading expertise.
The company awarded the last round of DSDP contracts in August 2019 and this was due to expire in September 2020. However, due to the coronavirus pandemic, these 2019-2020 DSDP awards were extended by six months.
Around 130 companies submitted bids in 2019, with 15 bids accepted and included BP, Vitol, Gunvor and Trafigura, in addition to some local companies such as Sahara Energy and MRS Oil and Gas.
Even Duke Oil unit, owned by the NNPC was included in the list of 15.
