If Petroleum Governance Industry Bill becomes law by the president assent, it will create Five organisations after unbundling NNPC
The ongoing restructuring of the Nigerian National Petroleum Corporation, NNPC received fresh impetus on Tuesday with the appointments and deployments of top executives across the value chain of its operations.
Group Managing Director of the Corporation, Dr. Maikanti Baru, told NNPC staff shortly before the announcement was made public that the new appointments would not only help to position the Corporation for the challenges ahead but would help fill the gaps created due to statutory retirements of staff. A total of 55 top management staff were affected in the exercise.
Under the new arrangement, Roland Ewubare, formerly MD of the Integrated Data Services Limited, IDSL moves to the National Petroleum Investment Management Services, NAPIMS as the new Group General Manager while Diepriye Tariah, former GGM and Senior Technical Assistant to the NNPC GMD takes over from Ewubare as MD of IDSL.
Malami Shehu, Executive Director Operations, of the Kaduna Refining and Petrochemical Company, KRPC, was appointed Managing Director of the Port Harcourt Refining Company, PHRC while Adewale Ladenegan, former MD of the Warri Refining and Petrochemical Company, WRPC was moved to KRPC to assume duty as MD.
In the same vein, Muhammed Abah, until recently, the Executive Director Operations of WRPC succeeds Ladenegan as MD of Warri Refinery.
With the retirement of Alh. Farouk Ahmed as the MD of the Nigerian Products Marketing Company, (NPMC), Umar Ajiya, former GGM in charge of Corporate Planning and Strategy, (CP&S) now assumes duty as MD of NPMC while Bala Wunti, former, General Manager, Downstream, GMD’s Office takes charge as GGM CP&S.
Other changes include: Usman Yusuf who takes over as GGM/STA to the GMD, Adeyemi Adetunji confirmed as MD NNPC Retail alongside Dr. Bola Afolabi who now functions as GGM in charge of Research and Development Division of the Corporation.
Also on the list is Mrs. Ahmadu-Katagum appointed GGM (Shipping) in the Downstream Autonomous Business Unit while Kallamu Abdullahi takes over as the GGM in charge of the Renewable Energy Division in the Downstream ABU.
Dr. Shaibu Musa was promoted MD of the NNPC Medical Services Limited while Ibrahim Birma is the new GGM in charge of the Corporation’s Audit Division now renamed Governance, Risk and Compliance Division.
Breaking NNPC into commercial entities
Among other key objectives, the bill promises to repeal the NNPC Act, and replace it with “commercially oriented and profit-driven” petroleum companies to be incorporated by the government.
In effect, the assets and liabilities of the NNPC will be split between two new companies, namely National Petroleum Company, NPC, and the National Petroleum Assets Management Company.
Both companies are to be incorporated by the Minister of Petroleum Resources within six months of presidential assent – that is if it gets that approval.
The management company will run all assets currently held by the NNPC, including OPLs under production sharing contracts, while other assets will be transferred to the NPC.
In both companies, the Bureau of Public Enterprises, Ministry of Finance and the Ministry of Petroleum are to hold shares in ratio of 20:40:40 respectively.
The bill also proposes a third commercial entity, the National Petroleum Liability Company, to be vested with “certain liabilities” of the NNPC and pension liabilities of the DPR in order not to financially encumber the Asset Management Company as well as the NPC.
The bill further seeks to repeal the Acts establishing the Petroleum Inspectorate, Department of Petroleum Resources and the Petroleum Products Pricing Regulatory Agency, and to transfer their functions, assets, funds and all resources to a new body, to be named Nigeria Petroleum Regulatory Commission.
According to the bill, this commission will have responsibility to regulate all aspects of the nation’s petroleum industry, including health, safety, environment, technical standards, infrastructural development, compliance with terms and conditions of contracts and leases, and enabling business environment.
It will also have power to grant licenses for downstream gas, petroleum products, retail outlets and transportation and distribution facilities.
The fifth body proposed by the bill is the Petroleum Equalisation Fund, which is to ensure “efficient distribution of petroleum products through the country” and “enhance development of all regions of the federation by ensuring economic balance in the price of petroleum products”; and “collect and provide funding for infrastructural development throughout the federation”.
Amehnews recalled that the Petroleum Governance Industry Bill (PGIB) which was passed by the Senate is aimed at a new structure that takes the oil industry assets and control from the Nigerian National Petroleum Corporation (NNPC), the passed bill, if and when it eventually becomes law by the assent to it, will achieve the strategic objective of freeing the oil industry from the stranglehold of a perennially corrupt machinery of government.
Also the PGIB passed by the Senate scrapped the NNPC, the Department of Petroleum Resources (DPR), the Petroleum Products Pricing and Regulatory Agency (PPPRA) as well as several government agencies in the oil sector while creating new entities to oversee activities in the sector. These new entities are the National Petroleum Company (NPC), the National Petroleum Assets Management Commission (NPAMC) and the National Petroleum Regulatory Commission (NPRC). Under the new governance structure, the NPC would operate as a profit-driven commercial entity while the NPAMC would be a single petroleum regulatory commission, with a clear mandate to oversee the sector.
The passed bill also saddles the commission with the responsibility for health and safety regulations in the industry and would collaborate with the Ministry of Environment on environmental issues. The commission is expected to be funded through the retention of 10 per cent of the revenue it generates though the expenditure is subject to appropriation by the National Assembly. Meanwhile, the NPRC will replace and take over the functions of the PPPRA and DPR when the PIGB finally becomes law.
There is no doubt that the PIGB will help strengthen the institutional and governance structure of the petroleum industry with the promotion of transparency and accountability.