Govt won’t engage in price-fixing, NUPRC assures petroleum producers

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has reiterated the Government’s stance on not interfering with product pricing, as long as prices of petroleum products remain reasonable and fair.

Gbenga Komolafe, the Chief Executive (CCE) of the Commission, stated this in Abuja during a meeting with members of the Oil Producers Trade Section (OPTS) and the Independent Petroleum Producers Group (IPPG). This is as the groups seek clarifications on certain operational challenges regarding pre-allocation of crude oil to domestic refiners, pre-existing contracts amid domestic crude supply obligations, and pricing issues.

According to him, the Government remains committed to the willing-seller, willing-buyer option which aligns with international best practices, and affirmed that the government would support the upstream sector’s optimal functioning without resorting to price-fixing.

Komolafe explained that while the Commission remains committed to regulating the industry as mandated by law, it is also focused on fostering growth within the sector, avoiding arbitrary actions that could dissuade operators or hinder investments, adding that in January, the Commission outlined a five-point agenda that would aid increased oil production in 2025.

‘’This includes effectively implementing initiatives to boost production by one million barrels, enhancing the transparency and accuracy of hydrocarbon measurement through metering and cargo regulations, digitalizing upstream regulatory activities for better compliance, optimizing unit costs per barrel to increase revenue, and conducting licensing bid rounds to revitalize non-performing assets in line with the provisions of the Petroleum Industry Act (PIA) 2021,’’ Komolafe said in a statement issued to journalists on Thursday.

Read also: Nigeria’s oil production now 1.75mbpd, as NUPRC targets additional 1mbpd by 2026

The CCE also noted that the Commission had developed a template to identify the needs of every participant within the value chain. This template, he said, aims to address gaps by leveraging the capabilities of different players, thus fostering collaboration, networking, and operational optimization.

‘’To ensure a consistent supply of crude oil to domestic refiners, the Commission early this month announced that significant regulatory actions to enforce compliance with the Domestic Crude Supply Obligation (DCSO) have been put in place, including the development and signing of the Production Curtailment and Domestic Crude Oil Supply Obligation Regulation 2023 along with the implementation of a DCSO framework and procedure guide.

‘’The Commission had emphasized that it would strictly enforce policies regarding implementation and defaults by oil companies and would not hesitate to deny export permits for crude oil intended for domestic refining if companies fail to meet their obligations”, he added.

Komolafe clarified that the reference to the denial of the export permit was not a threat to legitimate industry players, but specifically directed at non-compliant operators who might seek shortcuts, and in breach of the law.

He emphasised that the Government is committed to protecting the interests of investors but would not compromise on issues that could jeopardise energy security or undermine national interests.