11m-Barrel Dispute: NUPRC, Refiners Clash Over Crude Shortage Claims

A fresh controversy has erupted between the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and local refiners over claims of crude supply shortages, as the commission revealed that 11 million barrels of crude offered to domestic processors in one month were rejected.

NUPRC Chief Executive, Gbenga Komolafe, who was represented by Boma Atiyegoba at the Crude Oil Refinery-Owners Association of Nigeria (CORAN) summit in Lagos, disclosed that the crude was made available under the Domestic Crude Supply Obligation (DCSO) scheme.

According to him, the commission’s records show that while refiners have persistently complained about the non-availability of feedstock, several allocations offered to them were left unclaimed.

“In April 2025, out of 48 crude cargoes available for Nigeria’s export, 21 were set aside for local refining. Only 10 were lifted, while 11 were not taken up,” Komolafe said.

He attributed the non-uptake to commercial disagreements and technical preferences.

“Eight of those cargoes were declined because of pricing issues, while three were due to crude grade specifications. Refiners have their preferred blends based on refining economics. Even if the crude is available, they won’t buy what doesn’t meet their configuration,” he explained.

Komolafe, according to Punch Newspaper, noted that the commission operates under a “willing buyer, willing seller” framework and would not dictate commercial terms between producers and refiners.

“Crude oil is a global commodity. Prices are determined by international benchmarks, and the commission will not interfere in those negotiations,” he added.

However, refinery operators strongly disagreed, accusing the government of failing to meet its obligations under the Petroleum Industry Act (PIA).

Vice-Chairman of CORAN, Mrs. Dolapo Okulaja, said most local refineries receive less than half of their required crude, making operations unsustainable.

“We have the laws, but they are not being implemented. I cannot build a 20,000-barrel refinery and get only 5,000 barrels per day. How do I pay back my investors?” she queried.

She also said poor infrastructure remains a major challenge. “We can’t be moving crude in tankers across the country. There must be pipelines and logistics support for local refining to succeed,” Okulaja added.

President of CORAN, Momoh Oyarekhua, blamed contradictions in the PIA for the bottlenecks. “The same law that mandates crude supply to local refiners also introduces the ‘willing buyer, willing seller’ condition. That’s a conflict. You can’t have an obligation and still leave it to market discretion,” he said.

Similarly, Executive Secretary of the African Refiners and Distributors Association, Anibor Kragha, advised Nigerian refiners to diversify the types of crude they can process.

“Most of our refiners are too selective. They must expand their crude slates to include other blends. That’s how to boost refining efficiency and meet both export and domestic targets,” Kragha said.

The dispute comes amid growing concerns over the inability of Nigeria’s refineries – including the 650,000 barrels per day Dangote Refinery, to access sufficient feedstock, forcing them to source crude from international suppliers, including the United States.

Industry analysts warn that unless the rift between regulators and operators is resolved, Nigeria’s ambition to achieve self-sufficiency in fuel production and end importation may remain elusive.