The Nigerian National Petroleum Corporation (NNPC) has cancelled its previously signed offshore processing agreements (OPAs) with the Duke Oil Company, Aiteo Energy Resources, and Sahara Energy Resources (Nig).
Under the terms of the agreements signed with the three companies in January, the company allocated a total of 210,000 barrels of crude oil per day for refining at offshore locations.
This would be in exchange for petroleum products at yield pattern, which was agreed earlier.
The NNPC said: "After detailed appraisal of the operation and its terms of agreement, the NNPC is convinced that the current OPA is skewed in favour of the companies, such that the value of product delivered is significantly lower than the equivalent crude oil allocated for the programme."
"After due appraisal of performance trajectory, we have invited Messrs Oando, Sahara Energy, Calson, MRS, Duke Oil, BP / Nigermed, and Total Trading to bid for the new Offshore Processing Agreement, while we have engaged AITEO, Sahara Energy, and Duke Oil to exit the current OPA."
According to the company’s observations, the delivery terms were not optimal, due to which the structure of the agreement does not guarantee unimpeded petroleum products supply.
The company said it has commenced the process of establishing alternative OPAs based on an optimum yield pattern, with tender processing fees in a bid to address these lapses.