President Muhammadu Buhari yesterday stepped up the ongoing reforms in the oil industry with the cancellation of offshore processing and crude swap deals for refined products between Nigeria and oil merchants.
The decision was disclosed yesterday in Abuja by the President’s spokesman, Mr. Femi Adesina.
The deals, initiated in January by Buhari’s predecessor, Dr. Goodluck Jonathan, were designed to supply gasoline for crude as the country depends on imports for the bulk of its domestic consumption.
In an effort to end the endemic shortage of gasoline in Nigerian filling stations, the last administration allocated 210,000 barrels per day of crude to swap for products in 2015.
NNPC said President Buhari cancelled contracts for roughly half of the 445,000 barrels per day of crude earmarked for Nigeria’s refineries, the amount refiners’ use in the products swaps deals.
“Mr. President has approved the cancellation of the oil swap contracts. He has publicly expressed his displeasure over this oil swap deal.
“The government may not have completely dumped the idea of swaps but the aim is to re-evaluate the whole contracts terminated to extract some favourable terms,” he said.
Last month, Buhari appointed former Exxon executive, Ibe Kachikwu to head the NNPC with a brief to root out corruption in the corporation.
Kachikwu has said he will review all production-sharing contracts and joint venture agreements with its partners.
Crude-for-products swaps became controversial after several Nigerian officials raised questions about their transparency, including the
Nigeria Extractive Industries Transparency Initiative, NEITI, an EITI affiliate, and former Central Bank of Nigeria, CBN governor Lamido Sanusi. The government had in June launched an investigation to determine whether the government had been short-changed in the scheme. The outcome of the investigation is yet to be announced.

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PIB to be overhauled – Kachikwu
Meanwhile, Nigerians eager to see the immediate passage of the Petroleum Industry Bill, PIB, now before the National Assembly, may wait longer than expected.
This is because the Nigerian National Petroleum Corporation, NNPC Group Managing Director, Dr. Kachikwu, has said the proposed law needs to be reviewed.
Kachikwu said yesterday that a lot is required to address issues in the PIB following changes in the oil and gas environment.
His views were contained in a statement signed by NNPC Group General Manager, Group Public Affairs Division, Mr. Ohi Alegbe.
Kachikwu made the declaration when he chaired a special session on the proposed law at the ongoing 55th Annual General Conference of the Nigerian Bar Association in Abuja titled: “Legal and Regulatory Framework of the Petroleum Industry in Nigeria: Review of Existing Laws and the Petroleum Industry Bill, PIB.”
He described the bill as an essential legislation which must be approached with all the seriousness and thoroughness it deserves.
On what the Federal Government intends to do with the draft legislation, Kachikwu said the PIB had come to stay though it would take time to perfect it.
According to him, “PIB is a serious affair, it is an essential piece of legislation but as we all know a lot of engagement is required to address all the issues because the oil and gas environment has changed. There are issues of cost, with oil going down to $40 per barrel; the PIB cannot be the same.”
The bill has been pending in the National Assembly for seven years.

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