By Hosea Parah
The Crude Oil Refinery-Owners Association of Nigeria (CORAN) has called for the full institutionalisation of the Naira-for-Crude initiative, improved domestic crude pricing and stronger enforcement of the Domestic Crude Supply Obligation to accelerate local refining and reduce Nigeria’s dependence on imported petroleum products.
CORAN made the call at the 3rd Nigeria Oil Refining Summit, where it presented a 10-point agenda aimed at strengthening Nigeria’s refining industry, improving energy security and ensuring that the country captures greater economic value from its crude oil resources.
The association said Nigeria had reached a defining point in its petroleum-sector development, noting that the country could no longer afford to remain heavily dependent on crude oil exports while importing refined petroleum products.
According to CORAN, domestic refining is already changing the country’s fuel supply landscape, but significant challenges, particularly access to crude at commercially viable terms, continue to limit the full utilisation of existing refining capacity.
The association stressed that refining crude locally goes beyond producing petrol and other petroleum products, arguing that it would help retain foreign exchange, create jobs, strengthen local expertise, support manufacturing and petrochemical industries and deepen economic value within the country.
It therefore proposed the full institutionalisation of Naira-for-Crude, with transparent eligibility and access for qualifying domestic refineries, including modular refineries.
CORAN also called for the development of a domestic crude pricing template that takes into account crude quality, delivery points, avoided international logistics costs and actual domestic evacuation expenses.
It urged stronger enforcement of the Domestic Crude Supply Obligation under Section 109 of the Petroleum Industry Act, while stressing the need to preserve workable commercial arrangements between crude producers and refiners.
The association further proposed crude swaps and proximity-based supply arrangements that would enable crude-producing assets located close to domestic refineries to supply those facilities without unnecessary transportation through distant export infrastructure.
Another major proposal was the progressive reduction of petroleum-product imports, with imports increasingly limited to objectively determined domestic supply shortfalls and strategic-stock requirements.
CORAN also advocated the creation of a Refinery Development Financing Framework that would provide long-term financing, guarantees and refinancing mechanisms for new refinery construction and the expansion of existing facilities.
The association said Nigeria must also develop shared petroleum-product infrastructure, including pipelines, depots, storage terminals, jetties, rail evacuation systems and other common-carrier facilities needed to support a competitive downstream sector.
It called for the establishment of strategic petroleum-product reserves capable of cushioning temporary refinery shutdowns, maintenance periods and international supply disruptions.
CORAN further proposed regulatory and fiscal incentives for refinery expansion, particularly investments in conversion units capable of increasing domestic production of Premium Motor Spirit, aviation fuel, Liquefied Petroleum Gas and other essential products.
The association also demanded a clear domestic refining roadmap containing measurable national targets for refining capacity, domestic market share, petroleum-product imports and eventual export capacity.
CORAN said the country had already taken the difficult decision to reform the petroleum-products market, adding that the next phase of the reform process must be equally bold.
“Support the refinery. Support the pipeline. Support the storage terminals,” the association said, stressing that Nigeria could no longer afford a system in which it exports crude and jobs while importing the petroleum products derived from the same resource.
The association maintained that Nigeria’s crude should increasingly supply domestic refineries, while locally produced petroleum products should increasingly meet domestic demand.
It also expressed the ambition of transforming Nigeria into a major refining hub for Africa.
According to CORAN, achieving the objective would require sustained cooperation among crude producers, regulators, refiners, marketers, financiers, host communities and the media.
The association said stakeholders must move beyond policy speeches and communiqués to practical solutions, measurable commitments and partnerships capable of producing lasting results.
It noted that every barrel of crude refined locally could translate into more jobs, greater opportunities for businesses, increased value retained within the Nigerian economy and stronger energy security.
CORAN urged participants at the summit to ensure that the gathering resulted in concrete actions that would move Nigerian crude closer to Nigerian refineries and bring Nigerian refineries closer to the needs of consumers.
The association expressed confidence that, with effective collaboration across the petroleum value chain, Nigeria could evolve from being primarily a crude oil producer into a major refining and industrial hub capable of creating greater prosperity from its natural resources.
It called on stakeholders to seize the current opportunity to reshape Nigeria’s petroleum industry through increased domestic refining, reduced dependence on imports and greater value creation.
The association concluded with a call for a shared commitment to “refine more, import less, create more value, create more jobs” and build a stronger Nigerian economy through the transformation of crude oil into domestic prosperity.