The NNPC said on Tuesday it will replace the current Offshore Processing Arrangement with an arrangement under which it will directly sell crude oil to and purchase refined oil products from companies that own or operate refineries.
In a statement it said the move was “designed to enshrine transparency and eliminate the activities of middlemen” in the swap scheme. The OPA bidding process, which involved more than 100 companies began last month.
This move in essence has now eliminated trading companies who typically engage in the controversial Oil Swap deals. The deals were marred with controversy as many perceived players hardly imported the right quantity of products despite earnings huge commissions.
Industry analysts have been calling for an end to this for donkey years and had their prayers answered when the Buhari Government indicated that it will stop it. The NNPC will not have to prove that it has the operational capacity to make things work without hurting badly needed supplies to the domestic economy.