NNPC Awards 2017 Crude Term Contracts To 39 Companies

NNPC, Crude Term ContractsThe Nigerian National Petroleum Corporation (NNPC) has awarded 1.31 million barrels per day (BPD) of crude oil to 39 companies as part of its 2017 crude term contracts.

A statement by the Group Managing Director at the Public Affairs Division, Ndu Ughamadu, revealed the companies were selected for the term contracts after a transparent bid by 224 companies in December 2016.

The companies are 18 Nigerian owned companies, three foreign state owned companies, 11 international trading houses, five foreign refineries and trading arms of the NNPC group.

The statement said each of the contracts were for 32,000bpd apart from Duke Oil Limited, an oil trading arm of the NNPC which would be for 90,000bpd.

It also disclosed that the contract, which was announced by the Group General Manager of the Crude Oil Marketing Division of the corporation, Mr Mele Kyari, would run for one year, with effect from the January 1, 2017 for consecutive 12 circles of crude oil allocation.

The breakdown of the term contract winners are; Nigerian companies: Oando, Sahara Energy Resources Limited, MRS Oil and Gas, A.A. Rano Nigeria Limited, Bono, Masters Energy, Eterna Oil and Gas, Cavalva Energy, Hyde Energy, Britania-U, North West Petroleum, Optima Energy, AMG Petroenergy, Arkleen Oil and Gas Limited, Shoreline Limited, Emo Oil, Setana Oil and Prudent Energy.

International trading companies: Trafigura, Enoc, BP Trading, Total Trading, UCL Petro Energy, Mocoh Trading, Trevier Petroleum, Heritage Oil, Levene Energy, Glencore as well as Litasco Supply and Trading.

NNPC trading companies: Calson/Hyson and Duke Oil Incorporated.

Refiners: Hindustan Refinery, Varo Energy, Sonara Refinery, Bharat Petroleum and CEPSA.

Government to government: Indian Oil Corporation (India – IOC), Sinopec (China) and Sacoil (South Africa).

Rebels Attack Congo Mining Hub, 15 Killed

Hundreds of rebels armed with bows and arrows and machetes attacked a military camp and the provincial governor’s office in Democratic Republic of Congo’s southern mining hub of Lubumbashi on Saturday before being repelled by soldiers, authorities said.

The attack by pro-independence Mai Mai militia fighters on the capital of the central African nation’s copper and cobalt-rich Katanga province began around 1 p.m., sending the city’s residents fleeing home.

The Mai Mai, feeding off local grievances and secessionist sentiment, in recent months have ventured outside their stronghold in northern Katanga and toward the heart of the mining industry around Lubumbashi.

“Among the 300 assailants, around 15 were killed when they tried to resist the police,” Information Minister Lambert Mende told Reuters. He said the attackers, many of whom were children who appeared to be drugged, had only around 30 firearms.

“It is inconceivable that sane people would attempt this kind of operation with only 30 weapons,” he said. “They were drugged and manipulated.”

A resident, who saw the bodies of at least five attackers killed by gunshots near the governor’s office, said the group wore traditional magical fetishes to protect themselves.

They had attempted to hoist the flag of Katanga’s short-lived 1960s-era independent republic before members of the army’s elite Republican Guard launched a counterattack.

“They came out of nowhere,” said the witness, who said he had seen around 300 gunmen. “Then they just vanished.”

Soldiers continued to occupy important locations throughout the city in the late afternoon as traffic began to circulate and calm returned to the town.

Millions have died in the vast former Belgian colony’s long-simmering armed conflicts concentrated in the eastern borderlands, but the mining areas around Lubumbashi have remained relatively calm.

The Mai Mai’s roadless wilderness stronghold in northern Katanga is known as the “triangle of death” by locals in reference to atrocities, including massacres, rape and cannibalism carried out by the rebels.

Gunmen believed to be Mai Mai fighters attacked Lubumbashi’s airport last August – the second attack on the facility in two years – killing at least one soldier as government forces repelled the offensive after several hours of fighting.

Katanga hosts many international mining companies, including Freeport McMoRan and commodities trader Glencore, and exports around half a million tons of copper each year.

Nigeria’s Rating At Risk If $1.3billion Loan is blocked, NNPC Warns

The Nigerian National Petroleum Corp (NNPC) has told lawmakers at the National Assembly that any move to block its deals to finance payment of $3.5 billion owed to fuel traders could expose the country’s economy to a sovereign credit downgrade or a banking crisis.

Major oil trading houses including Vitol, Glencore, Trafigura and Mercuria are owed millions of dollars by Nigeria for fuel deliveries, according to a government-commissioned report released last year.

The report showed that Glencore was owed $138 million, Vitol $198 million and Trafigura $53 million.

NNPC accumulated the debts to traders, some of which are three years old, due to non-payment of fuel subsidies by the government, the head of the company told parliament.

But NNPC has explained that the financial facility it is seeking is not a loan warning that “the exposure of domestic banks is about $1.5 billion, and a default of this magnitude of exposure could lead to another round of banking crisis,” NNPC said in a statement.

NNPC’s Group Managing Director; Andrew Yakubu stated that “the continued delay has dire consequences ranging from a major negative impact on the sovereign credit rating to costly litigation against the federal government in foreign courts,” it added.

The House of Representatives committee asked to see NNPC’s documents and said it would investigate.

According to Reuters News agency, the Ministry of Finance Ministry did not respond to calls for comment as well as Trafigura, Mercuria, Vitol and Glencore all declined comment.

Engineer Yakubu also explained to the lawmakers that NNPC was borrowing $1.56 billion through a special purpose vehicle to offset part of the fuel import debts and that it had allocated 15,000 barrels per day of oil output for a period of up to five years to pay back the money, the company said in a statement.

Engineer Yakubu said the company planned to settle the remaining debts through a second such forward sales arrangement as well as internal resources.

Lawmakers have questioned the fund-raising deal, saying NNPC is not allowed to take out loans under rules set out in the constitution.

Standard Chartered, which managed the banking deal, also reportedly declined official comment.

Credit rating

Credit rating agency Standard and Poor’s upgraded Nigeria in November, citing improved financial stability and optimism over banking and electricity reforms.

Its ratings from the three major agencies are still in junk territory, however, at BB- from S&P and Fitch and Ba3 from Moody’s.

Nigeria’s banking crisis ended with a sharp recovery in bank earnings last year after a 2009 credit crisis led to the near collapse of nine lenders.

President Goodluck Jonathan attempted to end fuel subsidies a year ago but backed down after it sparked widespread protests.

Decades of mismanagement and corruption have left NNPC heavily indebted, several audits have shown.

Trading companies have been battling for months to recoup the money, and some have stopped supplying Nigeria with fuel. Most have remained in the West African country, however, partly because of the huge opportunities it presents in the trading of crude oil.