As current energy crisis in Nigeria continues to impact various sectors of the country’s economy, President Muhammadu Buhari and other key players in the country’s oil and gas sector, Tuesday, expressed confidence in the ability of newly created Nigerian National Petroleum Company Limited (NNPC), to help the nation advance solutions to its energy challenges, by attracting more investors and delivering value to Nigerians.
EnergyDay’s check showed that the NNPC Ltd was birthed as a result of the resolve of the Federal Government to reform the oil and gas sector, through the new Petroleum Industry Act (PIA) 2021, which allowed for improved fiscal framework, transparent governance and effective regulation of the sector.
President Buhari, Timipre Sylva, Minister for State Petroleum Resources and Mele Kyari, Group Chief Executive Officer/ Managing Director made this known during the presidential unveiling of the new NNPC at State House Conference Centre, Abuja, monitored by EnergyDay, on Tuesday.
The President, while describing the unveiling as “a landmark event for the Nigerian Oil & Gas Industry”, noted that the new company was mandated by law (the Petroleum Industry Act) to ensure that Nigeria’s energy security is guaranteed, for the sustainability and growth of all sectors of the economy.
He explained that the provisions of the PIA would guarantee that the NNPC Ltd operates without relying on state funds, as it will be “free from institutional regulations such as the Treasury Single Account (TSA)”,be commercially-driven, so that it can meet the energy demands of Nigerians and the international community.
‘‘The provisions of PIA 2021, have given the Nigerian petroleum industry a new impetus, with improved fiscal framework, transparent governance, enhanced regulation and the creation of a commercially-driven and independent National Oil Company that will operate without relying on government funding and free from institutional regulations such as the Treasury Single Account, Public Procurement and Fiscal Responsibility Acts.
‘‘It will, of course, conduct itself under the best international business practice in transparency, governance and commercial viability,” he said.
Buhari further stated that the establishment of a commercially viable national oil company would attract more investors and investments into the country’s oil sector.
The President also noted that the company was transformed to the capacity of the oil and gas industry and helped it meet global energy requirements, which includes energy transition objectives.
‘‘Our country places high premium in creating the right atmosphere that supports investment and growth to boost our economy and continue to play an important role in sustaining global energy requirements.
‘‘We are transforming our petroleum industry, to strengthen its capacity and market relevance for the present and future global energy priorities,” he stated.
He commended the National Assembly for the role it played in ensuring the successful creation of the NNPC Ltd, by facilitating the passage of the Petroleum Industry Bill (PIB) to law in 2021.
Mele Kyari, pioneer Group Chief Executive Officer of NNPC Limited (GCEO) of the NNPC Ltd, stated that the company is strategically positioned to help the country attain energy security and attract more investments through its “comprehensive expansion plan”.
Kyari revealed that the company is making arrangements to increase its fuel retail presence from the 547 outlets to over 1500 outlets, within six months.
He reiterated the commitment of the company in ensuring that the over 200 million Nigerians who are by law shareholders of the NNPC Ltd until it meets its Initial Public Offering (IPO) requirements and is ready to allow interested persons to individually own equity in the business.
He said one of the objectives of the new company is to become “the global company of choice” in the energy industry, by deepening the utilization of Nigeria’s petroleum resources.
‘‘NNPC Limited is positioned to lead Africa’s gradual transition to new energy by deepening natural gas production to create low carbon activities and positively change the story of energy poverty at home and around the world,’’ Kyari stated.
Timipre Sylva, the Minister of State for Petroleum, conveyed his goodwill message to the Management of the NNPC Ltd while stating that the new company will efficiently utilize Nigeria’s oil and gas resources, as well as, display a higher level of accountability and service delivery to Nigerians and its subsequent shareholders.
Sylva who described the creation of the NNPC Ltd as “a landmark achievement. and victory for all Nigerians”, stated that it was timely as the inefficiency of Government’s management of the oil company over the years and the delay in passing the… PIB into law, has cost the country about $50 billion worth of investments into the oil and gas sector.
He said, While the country was waiting for the PIA, Nigeria’s oil and gas industry lost about $50 billion worth of investments.
“In fact, between 2015 and 2019, KPMG states that only 4 percent of the $70 billion investment inflows into Africa’s oil and gas industry came to Nigeria, even though the country is the continent’s biggest producer and has the largest reserves.”
The minister said, with the new PIA, there is now a friendly environment that guarantees the safety of every investor’s investment in the oil and gas sector and the growth of their business.
“One of the magnanimous provisions of the PIA which is being unveiled at this important occasion, is the transition of the Nigerian National Petroleum Corporation into a full commercial entity which will be a Limited Liability Company incorporated under the Company and Allied Matters Act (CAMA) 2020, and to be known as the Nigerian National Petroleum Company Limited.
“The NNPC Ltd will operate as a profitable commercial entity, and declare dividends to its shareholders,” he said.
The establishment of the NNPC Ltd was possible after Buhari signed the Petroleum Industry Act (PIA) on August 16, 2021, EnergyDay recalls. This came 44 years after the creation of the defunct NNPC on July 1, 1977.