Confusion over DSDP contracts

by Editor

September 13, 2017 | 12:28 pm
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Since the Nigeria National Petroleum Corporation (NNPC) opened bids for this year’s Direct Sale Direct Purchase (DSDP) contracts in February, nothing has been heard about the outcome of the bid process and this has gotten players in the industry concerned. In the February opening of the bids, a total of 128 companies had expressed their intention to serve as off-takers of 800,000 barrels of oil per day.
The first concern raised by players in the industry was the 800,000 barrels of crude oil that was on offer considering that only 445,000 barrels of per day is usually allocated to the oil giant for local consumption. Industry players had therefore wondered where the corporation was planning to pluck the extra 355,000 barrels not covered by domestic allocation from.
Nonetheless since the opening of the bids, no official announcement of the allocation has been made except for unconfirmed media reports that some companies have been selected. The oil corporation also announced recently that it is going to embark on online monitoring of the DSDP process from September. But industry sources have told “Heard on the street” that the corporation is still yet to confirm those who won the bids for the last contract and if the 2017/2018 contracts have officially taken off.
Industry sources have told “Heard on the Street” that it is this lack of transparency around the oil contracts that facilitates the dealing of fraudsters who often claim that they have allocation letters from the NNPC. The Nigerian oil giant, last week, warned the public against fraudsters who are going around claiming to have allocation letters from the corporation warning that the corporation does not issue allocation letters in hotel rooms. But industry sources say until the corporation raises the transparency level around its crude oil contracts, fraudsters are always going to take advantage to dupe innocent people looking for legitimate business opportunities.

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by Editor

September 13, 2017 | 12:28 pm
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