At least 339 crude oil trading companies applied for the sale and purchase of Nigerian crude oil grades contracts spanning 2020 to 2022 by the close of the bidding process at noon yesterday.
Last month, the Nigerian National Petroleum Corporation (NNPC), invited “interested and credible companies” to participate in the open tender.
It described credible companies as those who are either bona fide end users who own a refinery and/or retail outlet or possesses a refinery that can process Nigerian crude oil grades.
Other categories include government-to-government arrangement with high energy consuming countries, internationally established and globally recognised large volume crude oil traders as well as indigenous Nigerian companies engaged in Nigerian oil and gas downstream business activities.
Declaring the bid process closed during the event which was partly virtual and partly physical, the NNPC team led by its Chief Operating Officer, Upstream, Mr. Adokiye Tombomieye , said the transparency and credibility of the process was of paramount importance.
The corporation stated that it will ensure that the best will emerge in the entire process, stating that it will adhere with the public procurement act and other relevant laws in coming up with the final winners.
“We guarantee all applicants that the evaluation process shall meet all due processes and all requirements and we are looking forward to the best emerging to lift Nigerian crude oil amid the current economic realities. We assure you of transparency in this process,” the corporation stated.
It added that the 2020 crude oil contracts for the sale and purchase of Nigerian crude oil will enlist reputable and highly capable international and indigenous companies that will guarantee market placement at optimum value for Nigerian oil.
“This is the only process through which off-takers intending to purchase crude oil from Nigeria are selected. All relevant documents have been endorsed by relevant agencies. Our commitment is to utmost accountability,” the corporation stressed.
As part of the process, the corporation picked Vitol SA and MRS, Nigeria to confirm the accuracy of their bids which were entered electronically on the NIPEX portal.
Some other conditions to be satisfied by the bidders, according to the NNPC were that the bidders must demonstrate minimum annual turnover of $500 million (or the naira equivalent) and net worth of not less than $250 million (or the naira equivalent) for the financial year ending of 2019.
Indigenous companies for certain categories of bids were also to meet the minimum turnover of $200 million (or the naira equivalent) and net worth of $100 million and the ability to establish an irrevocable letter of credit for the payment of any allocated crude oil subject to the contract terms.