Nigeria's President Bola Tinubu has asked the state oil company NNPC to sell crude to Dangote refinery using the local naira currency.
Bayo Onanuga, the president's special adviser on information and strategy, said Tinubu issued the directive to "ensure the stability of the pump price of refined fuel and the dollar-naira exchange rate."
The proposal to sell crude to Dangote refinery in naira currency was adopted by Nigeria's Federal Executive Council on Monday.
Dangote refinery and "other upcoming refineries" will purchase crude from NNPC in naira, Onanuga said in a statement on X on Monday.
Exchange rate
"Dangote refinery at the moment requires 15 cargoes of crude, at a cost of $13.5 billion yearly. NNPC has committed to supply four," Onanuga said.
"But the FEC has approved that the 450,000 barrels meant for domestic consumption be offered in naira to Nigerian refineries, using the Dangote refinery as pilot. The exchange rate will be fixed for the duration of this transaction," he added.
According to government, Afreximbank and other settlement banks in Nigeria will facilitate the trade between Dangote and NNPC Limited.
"The game-changing intervention will eliminate the need for international letters of credit. It will also save the country of billions of dollars used in importing refined fuel," Onanuga said.
'Sabotage'
The development comes after billionaire Aliko Dangote alleged that officials of the Nigerian National Petroleum Company Limited (NNPC) were sabotaging his refinery.
Dangote said NNPC had refused to sell crude to his refinery, forcing him to import crude from as far as the United States.
Currently, Dangote refinery needs about 300,000 barrels of crude daily. The facility currently refines crude to diesel and jet fuel.
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