The Federal Government has announced that it will com­mence the sale of crude oil to Dangote Refinery in naira from October 1, 2024.

This decision was confirmed by the Ministry of Finance fol­lowing a meeting with the tech­nical implementation commit­tee, chaired by Wale Edun, the Minister of Finance.

In a statement released on Monday, the ministry highlight­ed that the meeting focused on the transition to selling crude oil to local refineries in the Nigeri­an currency, a directive initially given by President Bola Tinubu.

On August 15, the govern­ment had inaugurated a tech­nical subcommittee to facilitate this transition smoothly.

At the latest meeting, the committee assessed progress on several key initiatives, includ­ing the scheduled start of naira payments for crude oil sales to the Dangote Refinery. The sale marks a significant shift in the country’s oil trade practices, traditionally conducted in U.S. dollars.

The ministry’s statement also outlined the roles of vari­ous stakeholders, including the Nigerian Midstream and Down­stream Petroleum Regulatory Authority (NMDPRA), Central Bank of Nigeria (CBN), Nigeri­an Upstream Petroleum Regu­latory Commission (NUPRC), and the African Export-Import Bank (Afreximbank), all of whom are tasked with ensur­ing the seamless execution of this policy.

Significant production in­creases are anticipated at the Port Harcourt and Dangote re­fineries beginning in November 2024, according to updates pro­vided during the meeting.

Zacch Adedeji, the Execu­tive Chairman of the Federal Inland Revenue Service (FIRS) and head of the technical sub­committee, mentioned that the first delivery of premium motor spirit (PMS) from the Dangote Refinery is expected next month under the existing agreements.

Earlier in August, the Dan­gote Refinery had announced its intention to start supplying petrol by the end of the month.

Wale Edun, Minister of Fi­nance, emphasising the need for transparency in the process, directed the subcommittee to finalise the details of the nai­ra-for-crude arrangement and to prepare a comprehensive report for President Tinubu. This report will confirm that the implementation is on track to begin in September.

The move follows a July 29 decision by the Federal Execu­tive Council (FEC), which ap­proved a proposal by President Tinubu directing the Nigerian National Petroleum Company (NNPC) Limited to sell crude oil to the Dangote Refinery and other local refineries in naira, marking a significant step to­wards the localisation of Nige­ria’s oil trade.

This initiative is expected to have far-reaching implications for the Nigerian economy, po­tentially reducing the pressure on foreign exchange reserves and fostering a stronger naira.