The Nigerian National Petroleum Corporation (NNPC) was reformed and a special relaunch event was held for this new changes on the 19th of July 2022.
According to Tolu Ogunlesi, the Special Assistant to President Muhammadu Buhari on Digital and New Media he stated, NNPC has not been ‘SOLD’, please. It is still wholly owned by Govt. What has happened is a TRANSITIONING from a Government ‘Parastatal’, into a commercially-run Limited Liability Company (still wholly owned by Govt of Nigeria,on behalf of the people of Nigeria), governed by CAMA.
Answering more questions he further stated that; For those asking, according to Petroleum Industry Act,2021, ownership of NNPC at incorporation is shared equally (50% each) btw Ministry of Finance Incorporated (MOFI) (which already exists) & Ministry of Petroleum Incorporated (new entity), “on behalf of the Federation.”
PIA says any sale of “Govt shares” in NNPCLtd shares will require “endorse[ment] by National Economic Council on behalf of the Federation.”
NB: NEC comprises 36 State Govs, & is chaired by Vice President—ie you need the 36 State Govs to endorse any sale of Govt shares in NNPCLtd
Watch this performance at the relaunch event;
@Asa_official sings “Fire On The Mountain” at the relaunch of the NNPC in the presence of President Buhari. pic.twitter.com/m83OCpJyvC
— Channels Television (@channelstv) July 19, 2022
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Meanwhile the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPC), Mallam Mele Kyari his target is to make the entity be among the top 50 among the Fortune 500 Companies in three years. Speaking in an interview with Arise the GCEO explained that with the huge assets available to the company and the new corporate culture of profit orientation, NNPCL would soon become the toast of the entire continent.
Fortune 500 refers to a list of 500 of the largest companies compiled by Fortune magazine, United States, every year wherein companies are ranked by their annual revenues for their respective fiscal years. The list includes both public and private companies using publicly available revenue data. According to him, the target would be achievable in the near term. While admitting that because of the mode of operation of the company in the past, Nigerians had lost faith in it, Kyari stated that henceforth the company has no room for excuses not to deliver on its mandate as a commercial venture.
He disputed insinuations that the NNPC was presently in a, ‘deep financial hole,’ insisting that no company declares profit when its finances are in trouble like the NNPC did last year. He added that although Nigerians were losing faith in the NNPC as a corporation, the company would shock doubters by its new mode of adopting global best practices in its operation. In the coming years, he stated that the company would have private equity, explaining that this would mature in the next 11 months, culminating in a mixed ownership of its shares.
On subsidy, he reiterated that it would no longer be a burden to the NNPC like it was in the last, explaining that it would not affect the company’s bottom line as the oil firm would henceforth charge a fee for providing such service to the government. He noted that the ministry of petroleum incorporated and the ministry of finance incorporated currently hold the shares of the company on behalf of over 200 million Nigerians. On the contention that the states and local governments are not currently represented on the board of the NNPCL since it’s a federation asset, Kyari stated that the National Assembly which made the law clearly represents every Nigerian.
Meanwhile, the NNPC has said it may not be possible for the Port Harcourt, Warrri and Kaduna oil refineries to function at their full capacities when they come back on stream after rehabilitation. He noted however, that they would operate at about 80 to 85 per cent nameplate capacity because they constructed roughly 30 years ago.
He disclosed that work on the Warri refinery would likely start next week, noting that the newly adopted model would ensure that the right thing was done so that lenders on the project can be paid back as soon as possible. He said the NNPC decided to repair the assets because it would endanger its objective of ensuring energy security for the nation without some level of operation in the downstream.
The CFO argued that if the nation were to build new refineries, they would cost too much, maintaining that the rehabilitation undertaken by the NNPC remains the best in the circumstance.