The New NNPC: Stakeholders Expresses Concerns, Optimism, Proffer Solutions for Efficiency

As Nigeria grapples with huge debt burden amidst dwindling revenue and inflation, the fiscal challenges before the economic handler as recently presented by the Finance Minister, Zainab Shamsuna Ahmed at the Public Consultation of the Draft 2023–2025 Medium Term Expenditure Framework and Fiscal Strategy Paper (MTFF/FSP) are daunting.

This is coming as the Nigeria National Petroleum Corporation transited to a company, now known as the Nigerian National Petroleum Company Limited (NNPCL), amidst uncertainties and optimism on how the organization will operate differently and profitably.

In the light of these uncertainties and the need to promote a culture of transparency and accountability in the operation of the new NNPCL, the Center for Fiscal Transparency and Integrity Watch (CeFTIW) organized a Twitter Spaces conversation tagged: the NNPC: Expectations and Challenges, with stakeholders expressing hopes and doubts about what has changed about the nation’s apex oil company.

Speaking, Mr. Umar Yakubu, the Executive Director of the Center expressed the hope that the recent transition in the corporation transition would not go in the way of previous privatization and commercialization policies of the government.

“There is still some high degree of government control and influence. Politicians are still on the board of the company,” he noted, and advocated that the company should be allowed to run entirely as a limited liability or as a Public Limited Company, which would allow Nigerians/investors to own shares and have majority control.

He said that the government’s overbearing control would stifle growth and urged that the NLNG model be adopted for efficiency. Yakubu advised that the starting point should be to strengthen the company’s corporate governance structure and culture which must begin with an overhaul of the current managers that brought about the current degeneration.

Yakubu also said that divesting control and eliminating government interest would bring the necessary oversight that would strengthen transparency; “the culture of wastefulness and mediocrity associated with government-run organizations must not be allowed to hover around the new company,” he added, stressing that allowing same handlers that caused the decay in the industry to continue as managers will not augur well for the organization.

He said that independence is essential for transparency in order for the company to attract investors and partnerships that would make it successful, noting that the new company must be transparent to the extent that the public should be able to know at a glance, the volume of products produced daily, volume sold, and the profit it traded.

Also leading the conversation, Aderemi Ojekunle, Business Editor, The Cable Newspaper expressed optimism that the current transition is a step in the right direction, and said that if the Petroleum Industry Act (PIA) is fully implemented with the right political will, that will break out from bureaucracy and maladministration in the sector, the oil sector would be on track to be a significant industry player in the coming years.

Ojekunle also hoped that the transition would improve the economy which is currently in a dire situation, as the nation looks to profit from the now independent state oil industry, and other reforms that the PIA will introduce.

The Center aligns its thought with the aforementioned submissions, especially the need for independence and a total overhaul of the management and ownership structure so the NNPC Limited can operate efficiently like other successful state-owned oil companies around the world.

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