Seplat Petroleum Development Company Plc has announced the signing of a Crude Purchase Agreement (CPA) with Waltersmith Petroman Oil Limited, in line with its commitment to boosting national energy output.
The recent disclosure is contained in a press statement signed by the Secretary of Seplat Petroleum, Mrs Edith Onwuchekwa, and made available on the Nigerian Stock Exchange platform today.
The Crude Purchase Agreement involves Seplat Petroleum supplying between 2,000 and 4,000 barrels of oil per day (bopd) from its share of Ohaji South Field within OML53 to Waltersmith’s new 5,000 bopd modular refinery at Ibigwe Field in Imo State.
Sources reported the commissioning of the Waltersmith Limited Refinery which is expected to deliver 5,000 bopd. In addition, Nairametrics reported that phase 1 of the project involves the firm processing circa 6,000 barrels of oil equivalent per day (boepd) currently produced by the upstream business (such as Seplat) to the readily available market in the south-eastern part of Nigeria.
In lieu of this, the recent CPA deal will boost the capacity of Waltersmith Limited to deliver its target.
Commenting on the recent development, the Chief Executive Officer of Seplat, Roger Brown, said:
- “We are delighted to sign this Crude Purchase Agreement with Waltersmith as it ensures that Nigerian crude will be refined locally by a Nigerian refiner. The agreement will eliminate losses we previously experienced on the export pipeline, meaning more revenue will be booked by Seplat for the same amount of oil produced from the field. Waltersmith’s refinery will also benefit the Nigerian economy by creating local jobs to refine our oil.”
Why it matters
The Crude Purchase Agreement is important to the Federal Government’s drive to increase the country’s refining capacity and halting importation of petroleum production, which will save a lot of foreign exchange for the country. Furthermore, the deal is a major boost to national energy security, as it aims to eliminate leakage in the transportation of crude oil.
