The federal government is considering about 254 bids from indigenous and foreign companies interested in the sale and purchase of the government's equity crude under the 2018/2019 crude oil term contracts.
The bids opening exercise was witnessed by representatives of the regulatory agency, the Department of Petroleum Resources, DPR.
Others that attended the event included the Nigeria Extractive Industries Transparency Initiative, NEITI, the Nigerian Content Development and Monitoring Board, NCDMB; and representatives of the civil society and the media.
A statement by the spokesperson of the NNPC, Ndu Ughamadu, at the end of the event, said eventual winners would be selected as licensed off-takers to trade on Nigeria's equity crude for a 12 months period.
Nigeria's crude oil allocation is done once every month to only successful companies.
Addressing the prospecting off-takers shortly before the commencement of the bid exercise, the Group Managing Director of the Nigerian National Petroleum Corporation, NNPC, Maikanti Baru, said the exercise was to promote greater participation of Nigerian enterprises, while preserving world-class standards.
Mr. Baru assured that best practices would be adopted in the selection of bidders, as he promised fairness and just treatment in the selection process.
"I wish to remind the general public that the Crude Oil Term Contract is not a Procurement Contract, but a process of selecting partners for the sale and procurement of NNPC Equity crude oil volumes," Mr. Baru said.
The Group General Manager, Crude Oil Marketing Division, Mele Kyari, mentioned some of the conditions potential off-takers under the 2018/2019 crude term contract were asked to meet. The conditions include having a minimum annual turnover of $500 million for 2016 and net worth of $250 million for 2016.
Mr. Kyari said apart from having the 2015 & 2016 audited accounts, aspiring off-takers must equally demonstrate the capacity to establish an irrevocable Letter of Credit, LC subject to contract terms.
On the marketability of Nigeria's crude in the international market, Mr. Kyari said Europe remained the major destination of Nigerian crude grades, accounting for 36.59 per cent of the total sales, with Asia and the Far East receiving 28.43 per cent.
He said about 16.57 per cent of Nigeria's crude grades was exported to North America, 13.17 per cent to Africa, 2.84 per cent to South and Central America, while the rest of the world served as beneficiaries of the rest.
The official further stated that the sustained reforms in the marketing and disposal of Nigeria's equity crude had eliminated the ugly incidents of 'briefcase' companies as witnessed in the past.
In 2017, a total 224 firms participated in a similar contract for the 2016/2017 season.
Successful bidders were to join in lifting over 700,000 barrels per day of crude oil by NNPC on Free on Board (FOB) basis.
The 26 Nigerian crude oil grades on offer included Bonny Light, Forcados Blend, EA Blend, Bonga, Qua Iboe Light, Yoho Blend, Erha and Escravos Light. Others are: Pennington Light, Agbami, Brass Blend, Abo, Oyo, Okono Blend, Amenam Blend, Akpo Condensate and Usan. The rest include: Atam Blend, Okwori, Okoro, Ima, Ukpokiti, Obe, Okwuibome, Ebok and Asaratoru.