Written by Emma Farge and Tim Cocks | From Reuters

Nigeria has awarded most of its long-term oil contracts worth an estimated $40 billion a year to local companies, according to a confidential list seen by Reuters, meaning global traders need to partner with them to access crude from Africa’s top producer.

Global commodity traders, refiners and Nigerian dealers jockey at an annual tender for access to the OPEC member’s prized crude oil, which is easy to refine and produces more high-value fuels.

The contracts cover around 340 million barrels of oil, worth close to $40 billion annually based on current Brent prices, and run for a year, though they can be renewed. They were allocated to just 28 companies, versus around 50 in 2012, the last time they were awarded.

In a break with tradition, no contracts were given directly to global trading houses Glencore Xstrata (GLEN.L), Vitol VITOLV.UL, Trafigura TRAFGF.UL or Gunvor, with only Switzerland’s Mercuria winning a contract, according to a list that four industry sources verified as accurate.

The trading companies that missed out on direct oil contracts declined to comment.

The list, released by the Nigeria National Petroleum Corporation (NNPC), is preliminary and subject to revision. NNPC officials did not immediately respond to requests for comment.

“It’s incredible to have an OPEC member selling its oil this way. There’s one international trading house and barely any refiners on the list,” said a senior oil trading source who formerly bought Nigerian crude oil.

Instead, several Nigerian oil companies featured on the annual list for the first time, such as oil trading company Hyde Energy, oil and gas firm Springfield, and Barbedos Group, a conglomerate that also provides luxury aviation services.

Long-established Nigerian oil trading firms Taleveras and Aiteo were also named on the list, which was circulated to winners last week.

Nigeria’s policy has been to increase the role played by local firms, both in operating oil blocks and trading, with the official aim of ending decades of control over the business by foreign majors.

However, several industry sources said the allocations favored powerful businessmen close to President Goodluck Jonathan’s administration ahead of what are likely to be closely fought presidential elections set for February next year.

Read more at Reuters