NUPRC Denies Crude Oil Shortage Claims, Says Refiners Rejected 11 Domestic Cargoes
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has refuted claims of crude oil shortages raised by domestic refiners, asserting that crude was available but underutilized. According to the Commission, a total of 11 crude cargoes offered for local refining in April were not lifted by refiners. The clarification came from NUPRC Chief Executive, Gbenga Komolafe, during the recent Crude Oil Refinery-Owners Association of Nigeria (CORAN) summit in Lagos. Represented by Boma Atiyegoba, Komolafe said the Commission has consistently made crude available under the Domestic Crude Supply Obligation (DCSO) policy.
Providing context, the NUPRC stated that in April alone, Nigeria produced about 48 cargoes of crude oil, out of which 21 were allocated for domestic refining, equivalent to 21 million barrels. However, only 10 of those were utilized, while 11 were left unutilized. Komolafe emphasized that the issue was not an unavailability of crude but rather commercial and technical disagreements between producers and refiners. He noted that refiners operate under a “willing buyer, willing seller” framework, which allows both parties to negotiate prices freely without regulatory interference.
In response, CORAN Vice-Chairman, Mrs. Dolapo Okulaja, disagreed with the NUPRC’s position, insisting that most local refiners are not receiving the crude volumes needed to sustain operations. She highlighted the gap between allocations made “on paper” and actual deliveries. “How do I repay my investors if I build a 20,000-barrel refinery and receive only 5,000 barrels per day? There is a clear imbalance,” Okulaja argued. She also rejected the notion that Nigerian refiners are being selective, explaining that logistical and infrastructure challenges, such as the absence of pipelines, continue to impede efficiency.
Adding his voice, Anibor Kragha, Executive Secretary of the African Refiners and Distributors Association (ARDA), urged Nigerian refiners to expand their capacity to process multiple crude blends. He stressed that such diversification is vital for long-term sustainability and would reduce dependency on specific grades. “Our refiners need to develop a crude slate to improve refining economics. This requires investment, but it’s essential for the future,” Kragha said.
Meanwhile, CORAN President, Momoh Oyarekhua, noted that while the Petroleum Industry Act (PIA) aims to support domestic refining, certain provisions — such as the combination of DCSO mandates and the “willing buyer, willing seller” clause — have created regulatory contradictions. He called for policy clarity to ensure a steady supply to local refiners. The ongoing debate comes amid growing concerns from players like the Dangote Refinery, which recently turned to U.S. suppliers due to insufficient local crude supply. Modular refinery operators have echoed similar frustrations, urging the government to fully implement DCSO provisions to stabilize Nigeria’s refining sector.
source: The sun