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Obas Esiedesa reports that the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is exploring crude swap deals to boost supply to local refineries. According to a recent statement, the Commission's Chief Executive, Mrs. Oritsemeyiwa Eyesan, disclosed during a visit to the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) in Abuja that the proposed swap arrangement would improve compliance with the Domestic Crude Supply Obligation (DCSO) and the Domestic Gas Supply Obligation.
The domestic crude supply to local refiners has improved significantly, with 53.7 million barrels supplied between April and June 2026, representing a 97.4 per cent performance in the second quarter. Despite the improvement, however, the importation of crude oil into the country persists, prompting the Commission to engage industry stakeholders on measures to address the challenge.
Explaining how the proposed swap mechanism would work, Eyesan said producers with obligations close to export facilities could exchange supplies with operators whose obligations and facilities were closer to domestic offtakers. 'How the swap works is that I have an obligation somewhere and I am close to an export facility. Somebody else has an obligation inland and his own (facility) is close to a domestic offtaker,' she said. 'So, instead of trying to move from one end to the other, we just agree on a swap arrangement, and there is a mechanism for them netting off.'
Eyesan noted that discussions on crude oil swaps were still in their early stages, stressing that the Commission would continue consultations with relevant stakeholders before finalising the modalities. She also pledged to deepen collaboration between the NUPRC and NMDPRA in the overall interest of Nigeria's oil and gas sector.
In remarks, the Chief Executive of the NMDPRA, Mallam Rabiu Abdullahi Umar, congratulated the NUPRC on what he described as a seamless and credible 2025 licensing round. Umar also commended the Commission for improving enforcement of the domestic crude supply obligation to local refiners. He noted that while the Petroleum Industry Act provides for transactions on a willing-buyer, willing-seller basis, pricing remained a major consideration in ensuring effective domestic supply. The NMDPRA chief therefore expressed support for the creation of strategic reserves, saying they would strengthen Nigeria's energy security and contribute to price stability.
The Commission's Chief Executive, Mrs. Oritsemeyiwa Eyesan, was appointed in 2022. Before her appointment, she served as Deputy Director in the Ministry of Petroleum. Eyesan holds a degree in Geology and has over 20 years of experience in the oil and gas industry.
The proposed crude swap arrangement is expected to benefit the Nigerian oil and gas sector, improving compliance with domestic supply obligations and increasing local refinery supply. The initiative, once finalized, could also contribute to price stability and strengthen Nigeria's energy security.
Nigeria's oil and gas sector generates significant revenue for the country. The proposed crude swap arrangement could help boost domestic refinery supply, reducing the country's reliance on imported petroleum products.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is a regulatory body responsible for overseeing the country's upstream oil and gas sector. The Commission plays a crucial role in ensuring the country's oil and gas resources are exploited in a safe and environmentally friendly manner.
The NMDPRA, on the other hand, is responsible for regulating the midstream and downstream oil and gas sectors in Nigeria. The Commission works closely with the NUPRC to ensure the country's oil and gas resources are managed efficiently and effectively.