Reps expose NNPC GMD’s shortcomings

 

Solomon Ezeme

After telling the nation that Nigeria has been able to save $1 billion annually since the introduction of Direct Sale, Direct Purchase (DSDP), Mallam Mele Kyari, Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), on Wednesday, failed to supply details of the DSDP’s transaction, on the request of the House of Representatives.

Kyari also failed to brief the House about progress being made regarding the rehabilitation of the Port Harcourt Refining Company for which $1.5 billion was approved in a contract awarded to Italy’s Tecnimont, in March 2021.

EnergyDay checks showed that the DSDP programme was launched in 2016.

Under the programme NNPC provides crude oil under a Free on Board (FOB) basis to a supplier while the supplier in return provides petroleum products to the NNPC at a designated port in Nigeria. The products supplied are equivalent to the amount of crude oil received by the supplier.

The House of Representatives’ Ad Hoc Committee on the State of Nigerian Refineries summoned Mallam Mele Kyari, the General Managing Director of the NNPC, to state the actual cost of rehabilitating some Nigerian refineries, especially the Port Harcourt Refining Company.

Ganiyu Johnson, Chairman of the Committee, asked the NNPC GMD also if there were fluctuations (variations) of the original contract sum.

While responding to the request by the House, Kyari said, “Chairman, I didn’t say I did not have answers to all the questions but it is very obvious that we did not respond to all the questions – the requests – that this honourable committee asked us to do. If we had done so, many of the questions that were asked today wouldn’t have come up in the first instance.

“That is why I said give me the grace so that I can respond to all the submissions that you have requested and I would clearly come back to you as you directed.

“Secondly, we know the contract sum. We are hiding nothing from you. There is no variation on this contract. If you look at the document I submitted to you, you will see the approval is for $1.559bn including VAT. So, there is no question that we do not have an answer to.

“I don’t have all the details; I will not be able to have all the details, definitely.”

The Chairman further sought to know the quantity of crude being taken from Nigeria and the volume of petroleum products being delivered to the country on a daily basis, under the Direct Sale Direct Purchase or oil swap deal with firms.

The Corporation could not give any figure on the quantity of crude oil and refined products involved in the oil swap deal.

The NNPC GMD also stated that the country currently has about 2.8bn litres of PMS (Premium Motor Spirit) which may not be able to serve the population for up to two months if importation is stopped.

“What is the quantity of crude oil given out per day under the DSDP programme to refiners outside this country? Two, what is the quantity of PMS received per day in exchange for the quantity of crude oil swap?” He asked.

Kyari replied, “Definitely, these are very specific numbers and there is no way I can give you a number on these, at this moment. First, let me tell you the principle around this. I know today, how much PMS we have in the country.

“I know we have up to 2.8 billion litres of PMS in the country at this moment, sufficient to keep us for 47 days if we don’t import.”

Kyari admitted that he has no knowledge of oil that is going on with the DSDP programme of which his Corporation was meant to coordinate.

“This is the basic information that I know. And all the PMS don’t come in equal volumes every day. Some days you can receive cargo and for three days may not receive cargo, and you can also receive up to four cargoes in a day.

“This is market-determined, supply-determined; you cannot give the volume for every day but we have data for every volume of PMS.”

“I have nothing to hide from this committee or any committee of the National Assembly. I have the responsibility to disclose everything I know to you and to Nigerians. I have the responsibility, by duty and obligation, to make sure that I don’t hold back any information.

“I do not know everything and of course, no one does. Everything that I know, I will tell you,” the GMD said.

EnergyDay checks have revealed that the Group Managing Director of the NNPC has made several appearances before the National Assembly in the past few months, with outcomes that have not strengthened public confidence in the NNPC as a public institution.