Nigeria, Africa’s largest oil producer, is set to offer up to 20% of its crude oil production for trading on its commodities exchange, according to Akinsola Akeredolu-Ale, the chief executive of the Lagos Commodities and Futures Exchange, in an interview with Bloomberg.
”The move aims to expand access to financing for the oil and gas industry, which is crucial to Nigeria’s foreign currency income,” Akeredolu-Ale said.
While Akeredolu-Ale did not provide a specific timeline for the commencement of crude oil trading on the exchange, he stated that the Lagos Commodities and Futures Exchange is collaborating with the local Securities and Exchange Commission to meet the requirements for trading crude.
“The consideration is that 10 to 20% of Nigeria’s crude oil production be provisioned for trading on the Lagos Commodities and Futures Exchange floor,” Akeredolu-Ale noted.
Currently, the most actively traded commodities on the exchange include gold, paddy rice, cashew, cocoa, and sesame seed.
As an OPEC member, Nigeria aims to increase its crude oil production in the coming months and years. Despite challenges such as oil theft and pipeline vandalism, the country has seen a recent uptick in production, reaching its highest level in over three years in February.
Additionally, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) reported an increase in crude oil reserves by 1 billion barrels and a significant jump in natural gas reserves by 2.573 trillion cubic feet (TCF) as of January 1, 2024.
This brings Nigeria’s combined proven reserves of crude oil and condensate to 37.50 billion barrels, with associated and non-associated gas reserves totalling 209.26 trillion cubic feet.
In a related development, the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has called on President Bola Ahmed Tinubu to consider relocating Military Chiefs to the Niger Delta region in a bid to curb crude oil theft, enhance revenue generation, and stabilize the nation’s economy.
Addressing journalists during the Association’s National Executive Council meeting in Abuja, PENGASSAN President Comrade Festus Osifo emphasized the urgent need for increased attention to the Niger Delta region.
He stressed that boosting crude oil production was vital for economic stability, citing a potential 30% increase in output as achievable with the proper measures.
