Taketake agreements are generally used to help the sales company acquire financing for future construction, expansion or new equipment projects by promising future revenues and demonstrating existing demand for goods. Chemical regulations, which are already highly regulated, are becoming increasingly complex. Globalization makes it even more of a challenge. At the same time, product liability services are facing this situation with fewer resources, as skilled staff are not available or budgets are not increasing at the same rate as regulatory burdens. The 2016 DSDP was designed to improve transparency with better conditions for the government, although structurally the same with previous oil-for-product swap agreements, with the exception of clearer conditions and stricter rules enshrined in the 2016 DSDP. The offtake agreements also contain standard clauses that include recourse – including penalties – each party has in case of violation of one or more clauses. According to the NNPC, Nigeria estimates oil reserves at 28.2 billion barrels of crude oil and 165 trillion feet of a thousand standard cubicles (including 75.4 trillion unsincompciated gas). In addition, the average extraction capacity is 2 million barrels of crude oil per day (bpd) and $7.6 billion per day of gas. Under an EARP, crude oil is awarded to a trader and the trader is then responsible for importing certain products of a value equivalent to that of crude oil, net of certain agreed costs and expenses whose value is retained by the trader. In early 2011, the government signed four RPEs with commodity traders through NNPC subsidiaries (Duke Oil and PPMC). In addition to providing a guaranteed market and a source of supply for its product, an acquisition agreement allows the manufacturer/seller to guarantee a minimum result for its investment.
Because taketake agreements often help secure funds for the creation or extension of a facility, the seller can negotiate a price that guarantees a minimum level of return on associated products and thus reduces the risk associated with the investment. NNPC`s crude oil trade is primarily contractual and, in 2017/2018, DSDP`s expected contract model, an improved version of the Oil For Products Exchange Agreement, which includes the process of inviting offers of crude oil sales and purchase contracts from potential customers. The NNPC sets pre-qualification requirements for potential customers: including: between 2010 and 2015, The trading model for crude oil trade was based on controversial oil-for-product trade until NNPC signed its first round of direct sales of crude oil and direct oil (DSDP) in 2016 worth up to 330,000 barrels of oil per day (b/d).