BY ADOGHOR BRIGHT OCHUKO
The African Energy Chamber (AEC) says it wholeheartedly supports and congratulates the inauguration of the Nigerian National Petroleum Company (NNPC) Limited and its official transition to a private entity, thus initiating a monumental shift in active engagement, accountability and value that is expected to reshape Nigeria’s petroleum industry, while simultaneously acting as a model for other National Oil Companies on the continent.
Inaugurated by Nigerian President Muhammadu Buhari on 19 July, the transition from NNPC Group to NNPC Limited is regulated in line with the provisions of the Petroleum Industry Act 2021. This transition will create a significant departure from the company’s previous operations, whereby major decisions had to be made based on the Federal Executive Council approval, thus exalting NNPC Limited with higher expectations around regulatory compliance, and active engagement with stakeholders, and perhaps most significantly, accountability.
“This is the beginning of something new. Mele Kolo Kyari and his team have done an amazing job towards this implementation. The strategic importance of this transition will allow Nigeria’s petroleum industry to uphold the highest levels of professionalism and innovation while allowing the company to operate in strategic engagements globally,” states NJ Ayuk, Executive Chairman of the AEC, adding, “Rather than rushing into the elimination of oil and gas, NNPC and Nigeria will now be able to more nimbly, transparently, and efficiently take advantage of its hydrocarbons and natural resources to bring more value and wealth to the country and its people.”
The creation of the NNPC Limited follows a decrease in crude oil production in 2022 compared to the same six-month period in 2020 and 2021 and is expected to place greater emphasis on corporate governance and operational excellence – fast-tracking development and bringing Nigeria back to the top of African oil production levels.
In order to achieve these goals, four committees have been established to provide oversight of the entity’s functions of planning and implementation and define a framework for monitoring the company’s performance. These committees include the Board Establishment Committee; the Board Finance, Strategy, and Investment Committee; the Board Sustainability Committee; and the Board Audit Committee.
The launch of NNPC Limited, which allows the company to become listed on the stock exchange with the sales of its shares now available to the public, positions the company on the same operational level as other successful state-owned petroleum corporations, such as Brazil’s Petrobas and Saudi Arabia’s Aramco.
The new, innumerable opportunities that this structuring will bring to Nigerians, Africans, and international investors and stakeholders will be showcased at this year’s African Energy Week (AEW) 2022, which will take place on 18-21 October in Cape Town, South Africa, exhibiting NNPC Limited as the company of tomorrow. AEW is the AEC’s flagship interactive exhibition and networking event that seeks to unite African energy stakeholders, drive industry growth and development, and promote Africa as the number one destination for African-focused events for the future of the continent’s energy sector.