Yemisi Izuora/Agency Report
There are strong indications that Nigeria is moving in the direction to cut the level of sulphur allowed in imported fuels this year.
The cap is reportedly still 10 times above what health campaigners urge.
In oil-for-product exchange contracts, the Nigerian National Petroleum Corporation, NNPC has asked for diesel and gasoline at a maximum of 500 parts per million, ppm, sulphur, trade sources said.
The NNPC last year outlined a plan to gradually cut the allowed sulphur to 50 ppm for diesel and 150 ppm for gasoline by the end of 2019, from 3,000 ppm and 1,500 ppm, respectively.
Some 40 companies have been shortlisted for the contracts, dubbed direct sale, direct purchase (DSDP), and have until the end of the day on Thursday to submit their pricing to supply the fuels, the trade sources said. The contracts are expected to begin in late August or September.
Currently, Nigeria relies almost entirely on imported fuels due to limited and poorly maintained refineries. The country also caps prices for gasoline, which means the government would pay directly if it mandates higher-quality fuel.
The United Nations Environment Programme and health campaigners have pressed West African nations to ban fuels above 50 ppm due to evidence of significant health problems associated with the emissions. The health impacts are particularly acute in dense urban areas such as Lagos.
Thus far only Ghana has made good on the pledge to cut the imported sulphur cap to 50 ppm, reports Reuters.
Experts said Nigeria’s new limits would change little, as few global refineries produce gasoline or diesel above 500 ppm.
“Given the relatively low sulphur content of gasoline currently imported, the new sulphur limit will not have a marked effect – either on quality or price,” said Jeremy Parker, the head of business development with Africa-focused consultancy Citac.