Why New NNPC Ltd Won’t Need My Consent For Any Transaction—Sylva

Posted by Nwa Diokpa Business News, Latest Headlines Wednesday, July 20th, 2022

(AFRICAN EXAMINER) – The Minister for State Petroleum, Timipre Sylva, says that the Nigerian National Petroleum Company Ltd will establish a world-class structure that will enable it to become a game changer and make it take decisions quickly.

African Examiner recalls that President Muhammadu Buhari had on Tuesday unveiled a new independent national company with a fresh slogan, ‘Energy for Today: Energy for Tomorrow’.

The new company will declare profit to the Nigerian government which is different from the previous regime where it was expected to fund the Federation Account monthly.

“We have given them independence; I am now part of government. NNPC Ltd had to come up with a corporate structure that will work for them. Of course, the government will step down and we as shareholders will expect NNPC to perform properly and declare dividend to us,” Sylva said on Arise Prime Time.

Sylva also disclosed that the NNPC Ltd will keep the country’s moribund refineries in Port Harcourt, Warri and Kaduna.

He said: “NNPC is going to be an integrated company, not just an upstream company. It is an Upstream company, midstream and downstream. Of course, we will keep the refineries.

“Let’s take an example of a refinery. Let’s say there are seals that are bad in Port Harcourt refinery, they have to report to Abuja that the seals are bad. Abuja assesses and realizes that the scope of work is bigger than the management it will go to the Federal Executive Council.

Now a FEC memo has to be prepared for the NNPC to go to FEC because it is beyond the approval limit of the GMD of the NNPC. By the time the FEC get to approve it and comes back of course before the contract is awarded, maybe five to six months have elapsed. More seals are bad, more things are bad, you come back again and follow the same cycle.”

He stated that the bureaucracy was not optimal, saying that with NNPC operating “commercially, they don’t have all these problems. They can now report within them. They don’t have to go to FEC; they don’t have to come to me as a minister. It is a company decision on how they are going to fix it”.

Sylva disclosed that there are options to list the NNPC on the capital market or float an Initial Public Offer. However, this may not happen under the current administration due to ‘time’ constraints.

He said: “Going from here, we can decide to list it, decide to float an IPO or decide to go public. That is a decision to take. Now it is a commercial entity, going from there it is a decision to be taken whether you want to privatize it or whether you want to sell it outright or you want to say, let’s privatize the whole of it and sell it as NNPC. That is also an option.

“I don’t think we (Buhari’s administration) have the time as a government to get to the point to take that kind of decision, but at least we have been able to free it from the shackles of being part of government.”