Nigeria’s upstream oil regulator has announced it will block export permits for oil producers who fail to meet their required crude supply quotas for local refineries, including the Dangote Refinery, Africa’s largest.
The Petroleum Industry Act mandates oil producers, including international oil companies, to allocate a portion of their crude production to domestic refineries before exporting—a requirement known as the Domestic Crude Supply Obligation.
However, oil producers argue they have been unable to comply because local refiners are not offering competitive prices. This has led the Dangote Refinery to call on regulators to enforce the law.
In a statement on Monday, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) said its Chief Executive, Gbenga Komolafe, had written to oil exploration and production companies, reminding them of their legal obligations and the penalties for non-compliance.
The commission said it recently held meetings with both producers and refiners. While refiners accused oil producers of failing to honor supply commitments, producers countered that refiners were offering uncompetitive prices, forcing them to seek alternative markets.
Komolafe warned that diverting crude cargo meant for local refineries violates the law and that the commission “will henceforth disallow export permits for designated crude cargoes intended for domestic refining.”
For the first half of 2025, Nigeria’s refineries are expected to require 770,500 barrels per day (bpd) of crude, with the Dangote Refinery alone projected to need 550,000 bpd, according to a schedule published by the regulator.
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