By Kabir Kabo Usman
The current transformation of the Nigerian National Petroleum Company (NNPC) Plc, from an obscure and hopeless public corporation to a viable and reliable public limited company, is generating interest for discussions at high and low places.
But in this millennium where civilization has replaced primitive norms, it was expected that discussions on the performance or otherwise of a critical factor in the socio-economic development of the society like the NNPC Ltd should be objective not subjective. Opinions and suspicions are never facts.
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As a Ph.D. holder in Petroleum Chemistry since 1988 from Manchester University UK, I commend the transparency and accountability of the current Chief Executive of the NNPC Ltd, Dr Mele Kolo Kyari, after a careful study of his performance and track records with probity and objectivity knowing fully well the nature and dynamics of oil and gas industry, having been a consultant for over 20 years. Integrity pays but at high price in governance of global sector like the one under discussion.
As I am living near but far, I cannot stand by and watch my two respected brothers whom I have high regard, with high degree of integrity, probity and patriotism making negative comments on the stewardship of another brother in an important socio-economic public organization. It is no longer news that recently the Governor of Kaduna State, Malam Nasiru El-Rufa’i, CON, and the Former Governor of Central Bank of Nigeria (CBN), Malam Muhammadu Sunusi II, CON., (aka Sanusi Lamido Sunusi) the immediate past Emir of Kano, were critical of the performances of the NNPC PLC under Dr Kyari.
All what is being discussed is mostly about real time and online data which can be accessed and assessed by all through the data protection act. In the said discourse so far, there is a vacuum due to lack of information. There is a communication gap. I used the powers available to me by the data protection act to get the data of contention in the three areas without any barrier as a matter of facts. This is what is enabling me to make comments with foresight, far sight and insight in a cogent, succinct and ratiocinate manner.
Searching for the truth enabled me to stumble on the NNPC modular refineries policies – of which some refineries are working now in Akwa Ibom and are a case in point of success and progress so far. One such refinery that will be a beacon of NNPC’s refinery policy is the mammoth Dangote Refinery.
The Dangote refinery when it becomes operational will produce 250,000 barrels per day to reduce our PMS import by 33%. Some of the short, long term and everlasting benefits of Dangote Refinery and Petrochemical Plant will save Nigeria a minimum of $10 billion a year on imports; the Ammonia component of the plant will produce 2.8 million tonnes of Urea and it will produce its own electricity. The revitalization of the existing three refineries is on course.
All the civil engineering works at the construction site are done by Nigerian companies; the plant will have an export value of $6 billion per annum that will increase Nigeria’s foreign reserves by at least 40% of current value on a yearly basis.
Refined products to be produced at the plant will include Propane, Petrol, Jet Fuel, Diesel, Kerosene, Carbon Black, Polypropylene, Polyethylene as Petrochemicals and Pharmaceuticals derivatives.
The United States Trade and Development Agency is supporting this project with $997 million while NNPC PLC has acquired 20 to 25% shares in this venture.
Strategic imperatives of diversifying from dirty to clean and cheaper energy to stop relying on PMS was also highlighted as a government policy as the country’s commitment on Carbon Zero and Carbon Neutral recently signed by President Buhari at Glasgow and Paris conventions. This will promote the three D’s- decentralization, de-carbonization and digitalization agenda in the renewable energy sector to tackle environmental degradation via pollution.
The Federal Government of Nigeria’s strides in providing rail networks that promote movement of goods and services ties in nicely to the NNPC efforts of lessening the burden and relying on petrol and diesel. All these are policies that will ensure less dependency on our refineries while ensuring Nigeria reaches its international fuel and clean energy commitments through its renewable energy policy thrust on solar, wind and biomass.
These are all good policies to stop relying on oil. NNPC PLC is finally moving the needle on dirty energy dependency. While the AKK project is on course to help pivot towards the use of gas as a transitional energy source. The future of NNPC is no longer traditional oil and gas. Rather it will be seen as a forward-looking energy company in accordance with the Petroleum Industry Act (PIA) as envisioned.
One nagging issue raised by one of the commentators was that NNPC failed to remit a dime to the federation account, that “We are living on taxes. It is PPTs, royalties, income tax and VAT that is keeping this country going because NNPC claims that subsidy has taken all the oil revenues. PPT, NLNG and NNLG tax and profit are examples to the contrary of this claim.
The other brother suggested that the government should be completely out of oil and gas business, or NNPC Ltd should be completely disbanded and unbundled like Petrobras- think of Aramco, the oil company in Kingdom of Saudi Arabia. Then please come to think of PIA that took 20 years to arrive to the destined promised land.
There was also the allegation that the volume of our internal PMS consumption is inflated. The importation of PMS is a very complex process with many stakeholders and players. With the variabilities and complexities of thousands of kilometers of borders to countries where PMS is more expensive, consumption indicators for many commodities are hard to measure. One needs to look at the price of pms within the neighborhood, that speak volume as Nigeria has the cheapest by far.
You cannot be directed by the government to subsidize the price of oil and be asked to remit the money that was spent already.
The impressive Dashboard and Data Control Centre shown by NNPCL indicates a significant improvement so far made to tackle the oil thieving that is a nightmare to everyone in the sector. All hands are on deck tackling the issues with rigor and vigor as you all know what the CEO of the organization is doing relentlessly.
Advising the Federal Government to sell the NNPC Plc shows that some people don’t understand what the PIA is all about. Grab a copy of the Act for your perusal and come back to the public gallery to say what you learnt.
On June 12, 2020, NNPC published its first audited financial statements ever after 44 years of its operation. It might not be a feat to some but it attracted the commendation of the United States Department of State, where in its 2020 annual report it singled out NNPC in Nigeria as the most transparent and accountable among others.
Ours is an oil sector that has been battling a decade old disease. A temporary solution can’t be an option. It is time for hard decisions, no matter how unpopular, to be taken. We should all support the CEO of NNPC PLC who was recently honoured by the president with OFR for his selfless service, commitment and by implementing his transformation agenda and working on the road map that will take the organization to greater height.
He has now joined the league of respected Nigerians who contributed to the progress of the nation. Other members of the league include His Excellency Malam Nasiru El-Rufa’i, CON., and His Royal Highness, Malam Muhammadu Sunusi II, CON.
Usman, PhD, a former Director General of Centre for Management Development (CMD), writes from Abuja
