Modular Refineries Reject Domestic Crude Due to Costs

The Crude Oil Refinery Owners Association of Nigeria (CORAN) reported that its members did not lift any crude oil allocated under the Domestic Crude Supply Obligation (DCSO) by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) in the second quarter of 2026. CORAN spokesman Eche Idoko cited "unrealistic commercial terms" and high costs linked to international crude pricing benchmarks as the reasons for this decision.

The NUPRC data indicated that 68.1 million barrels were offered to the Dangote Petroleum Refinery, which accepted 52.6 million barrels, accounting for 78 percent of the volume offered. Idoko explained that the use of pricing indices like Platts, Brent, and West Texas Intermediate made crude too expensive for modular refineries, leading to double charges on logistics.

He noted that modular refineries typically purchase crude directly from production sites and bear the costs of transportation. The NUPRC's report showed that 53.7 million barrels of crude oil and condensate were supplied to local refiners between April and June, reflecting a DCSO performance of 97.4 percent.