The Nigerian National Petroleum Company (NNPC) Limited started its activities for the week at the World Bank Nigeria Development Update in Abuja, with a fresh commitment to the ongoing reform in the oil and gas sector in Nigeria.
The event which held at the Transcorp Hilton Hotel in Abuja saw the Group Managing Director (GMD)/Chief Executive Officer (CEO) of NNPC, Malam Mele Kyari insisting that the reforms in the oil and gas sector were unstoppable.
Kyari noted that the Petroleum Industry Act (PIA) had provided a clear legal framework for the process.
He explained that the PIA was very comprehensive in its provisions on the operations and responsibilities of the industry players as well as allocation of timelines for the categories of various activities.
“There is a reform going on particularly in the energy sector and no one can stop it,” he said.
The NNPC CEO continued: “For instance, the issue of removal of subsidy is now guided by law and you have to go back to the National Assembly to stop it.
“Also the Act provides for issues around the relationship between the national oil company and other institutions of government in relation to timelines, which is a clear departure from the past,” the Kyari said.
On the issue of subsidy, he noted that it was no longer realistic for the Federal Government to continue to bear the burden of the monthly provision of the sum of N250billion for petrol subsidy.
This, he said was in spite of government’s intention and efforts to continue with the subsidy in the interest of Nigerians.
He added that the new NNPC as established under the PIA would soon resort to invoicing the government to enable it recover the cost of providing the petrol.
On their part, the Minister of Finance, Mrs Zainab Ahmed, and World Bank’s Country Director for Nigeria, Mr Shaudhuri Chaudhuri, said that the removal of petrol subsidy had become inevitable as government requires the funds used for subsidy to invest in other critical sectors of the economy that would make life easier for Nigerians.
Speaking at the event, the Governor of Kaduna State, Malam Nasir El-Rufai and the World Bank’s Lead Economist for Nigeria, Mr Marco Hernandez commended the GMD for his forthright leadership in the execution of the oil and gas sector reforms.
Meanwhile, the NNPC has called on members of the Independent Petroleum Producers (IPPG) to recommend new strategies to tackle the challenges facing the Nigerian oil and gas industry.
Kyari, gave the charge while hosting the new executive of the IPPG in his office at the NNPC Towers, Abuja, on Tuesday.
The GMD said that the current reality in the petroleum industry called for a clear understanding and commitment of all players in order to reposition the industry for enhanced performance.
He said though the PIA had eliminated the uncertainty and lack of clarity that had bedeviled the industry in the last 25 years, there was need for practical steps by players in the industry to redress the situation.
“There are immediate problems which we know.
“We found ourselves in this situation because everybody failed, so we have to bring everyone to the table to accept this reality and come up with an intervention that is different, not what we have always done,” Kyari said.
He disclosed that significant progress had been made in reducing the incidences of crude oil theft and called for all hands to be on deck to work towards eliminating the menace.
On gas pricing, he said though the country was under supplied, the PIA had created an enabling environment for producers to recover their cost through a flexible structure that had been put in place by the government.
He assured the group of NNPC’s readiness to collaborate with them.
Speaking earlier, Mr Isah Abdulrasaq, Chairman of the IPPG which is a group of indigenous oil companies operating in the Upstream sector, commended the GMD for his role in the passage of the PIA and his appointment as the CEO of the NNPC Limited.
He said, as a limited liability company under the Companies and Allied Matters Act (CAMA), the new that members of IPPG can engage both parties to learn from each other.
Abdulrasaq called for the inclusion of IPPG on the PIA Implementation Steering Committee in order to facilitate and achieve a collaborative and inclusive approach to the reforms.
On the absence of funding as a result of the global energy transition, Abdulrasaq called for the establishment of an energy bank to provide funding for the petroleum industry.
He disclosed that indigenous players in the industry currently produce 252,000 barrels of crude oil per day and 650million standard cubic feet of gas per day, amounting to about 50 per cent of the nation’s gas requirement.
The IPPG leader called on the government to undertake international advocacy for the consideration and recognition of gas as a transition fuel in order to attract investment into the sector.
The chairman was accompanied on the visit by the executive members of the group, including the immediate past chairman, Engr. Ademola Bero.
Also on Tuesday, the Federal Government dismissed reports on plans to hike fuel price.
Chief Executive Officer of the Midstream Petroleum Regulatory Authority, Farouk Ahmed, who made this position known in Abuja on Tuesday, reassured that there were no plans to increase the official price of Premium Motor Spirit (PMS), as being speculated in some quarters.
Ahmed spoke when he fielded questions from State House Correspondents, after he along with the newly appointed Chief Executive Officer of the Nigeria Upstream Petroleum Regulatory Commission (NUPRC), Gbenga Komolafe, were officially presented to President Muhammadu Buhari.
This came just as government through Minister of State, Petroleum Resources, Timipre Sylva, promised to do something drastic concerning the rising cost of cooking gas to address the pains Nigerians were going through, especially this Yuletide season.
The Minister of State, Petroleum Resources, Timipre Sylva, presented the two Chief Executive Officers to the President at the Presidential Villa, Abuja, on Tuesday.
Ahmed maintained that the marginal queues being witnessed at filling stations in Abuja and some parts of the country had nothing to do with any supposed plan by government to hike PMS price.
He, however, stated that the queues were caused by the payment logistics in U.S. Dollars by depot owners, and the issue is being addressed by relevant authorities.
“Basically, what happened is that some of the depot owners selling Premium Motor Spirit above the official ex-depot price of N148, are selling at N156 or N157.
“The reason is that they are paying for their logistics like shipping and Port charges and Nigerian Maritime Administration and Safety Agency (NIMASA) charges in US Dollars and they have to go to parallel market to source for the Dollars.
“The differential between the official exchange rate and the parallel market is their reason for adding between N9 and N10.
“But we had a meeting on Tuesday, Nov. 9, and the heads of the Nigeria Ports Authority and NIMASA as well as other stakeholders were all there and it was resolved that NNPC excess capacity vessels would be chattered to oil marketing companies and they would be charging in Naira.
“NIMASA and the Ports Authority will also revert back to their supervising ministries and get directives to collect their charges in naira rather than US Dollars.
“I believe with these, there will be no reason for the depot owners to increase their price beyond the official selling price of N148,” he explained.
Also addressing the State House Correspondents, Sylva said the president was happy with the level of implementation of the Petroleum Industry Act (PIA) 2021.
According to him, President Buhari urged the regulators in the petroleum industry to do what is best for Nigeria.
He said: “The President is happy with the level of implementation of the PIA. A lot is going on, already the agencies created by the law are now in place.
“The President charged us to ensure that we use our best experience to ensure that the industry is on track.
“Luckily for us, we have very experienced people on the saddle, both in the authority and the commission and the President asked us to go ahead and do what is best in the interest of Nigeria at all times.”
On the recent increase in the price of cooking gas in the country, the Minister said “the President is worried over the situation just like all other Nigerians.”
Sylva further said although the price of the essential commodity was not regulated by Nigeria, some steps would be taken internally to provide some relief, ahead of the yuletide season.
On the transition of cars from the use of petrol to gas, he said government needed about N6 billion for the procurement of kits to convert the first one million cars as well as facilitate the procurement of equipment that will enable gas pump stations come on board.
Still in the week under review, the Nigerian Pipelines and Storage Company (NPSC), a subsidiary of the NNPC Limited, donated a block of four classrooms and headmaster’s office to one of its Benin Depot host communities, Ohovbe Community in Ikpoba-Okha Local Government Area of Edo State.
Speaking at the commissioning and official handover of the project, the Managing Director of NPSC, Engr. Mansur Sambo, expressed the company’s commitment to giving back to its host communities through Corporate Social Responsibility (CSR) projects.
Sambo who was represented by the Manager Public Affairs, Mrs Ebika Onyema, noted that it had been NNPC-NPSC tradition to always positively impact lives in its host communities.
Earlier in his welcome address, the Enogie of Ohovbe, His Royal Highness, Dr Iduriase Oyenmwensere, expressed gratitude to NNPC Management for the laudable gesture.
Also speaking, the Acting Chairman, Ikpoba-Okha Local Government Area, represented by the Director of Administration and General Services, Mrs B.E. Uhunmwangho, stated that the Local Government Area would do all in its capacity to partner with NPSC in sustaining the project.
She urged members of the community to see the project as a donation towards improving the yearnings and aspirations of children within the community and tasked them to contribute their quota towards protecting the project from vandalism.
The Edo State Commissioner for Education, represented by the Education Secretary, Mrs Osarogiagbon Isokpan, who officially handed over the project thanked the Management of NNPC- NPSC and prayed that the pupils who would use the classrooms would grow up to become excellent examples in their different career paths.
The Current drive by the NNPC Limited to strengthen gas penetration and utilisation across the country received a major boost within the week with the signing of a Memorandum of Understanding (MoU) for the supply of gas to industries and investors in Nasarawa state.
The MoU which was designed to ensure that the state derives maximum value from the Ajaokuta-Kaduna Kano (AKK) gas pipeline network was signed in Lafia by the NNPC, Gas Aggregation Company Nigeria Limited (GACN) and the Nasarawa State, at the Nasarawa Business Roundtable organised to explore investment in opportunities in the gas sector.
The signing of the MoU which was the climax of the Nasarawa Business Roundtable was witnessed by the Nasarawa State Governor, Abdullahi Sule and the GMD/CEO NNPC Limited, Malam Mele Kyari.
