Modular refineries shun domestic crude over high costs
Nigerian modular refineries are shunning domestic crude oil allocations due to high costs and unrealistic commercial terms, impacting local refining effort Read More: https://punchng.com/modular-refineries-shun-domestic-crude-over-high-costs/
The Crude Oil Refinery Owners Association of Nigeria (CORAN) reported that its members declined to accept domestic crude oil supplied under the Domestic Crude Supply Obligation (DCSO) in the second quarter of 2026. The reason cited by the refineries was the high costs associated with international crude pricing benchmarks and the perceived double charges on logistics.
According to CORAN, modular refineries were not supplied any crude oil during the period under review. The main issue is that these smaller refineries purchase crude directly from producing assets and are responsible for evacuating it to their facilities. When international pricing indices like Platts, Brent, and West Texas Intermediate are used, the cost of crude becomes very high for modular refineries, as they pay for freight, insurance, and transportation costs while still bearing the cost of picking the crude at the wellhead.
CORAN spokesperson, Eche Idoko, emphasized that a more equitable domestic crude pricing framework should consider the actual delivery point and remove costs not incurred by the producers.
Written by urgent.news from Punch Nigeria's reporting — not their text. Machine-written — it may contain errors, so check the original before relying on it.
