The reapportionment of the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited, Mallam Mele Kyari by President Bola Ahmed Tinubu is a reward for the performance of the NNPC boss which has placed the national oil company and the nation’s oil and gas industry on a positive trajectory,
Last week, President Bola Ahmed Tinubu, who is famous for having the knack to spot out talents and competent people reappointed the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPC), Mallam Mele Kyari to continue his performance at the company and the nation’s oil and gas sector at large.
Expectedly, the news of his reappointment elicited mixed reactions within the political and industry circles. Those who understand Kyari’s stellar performance, his enviable qualities and competences commended the president for such a wise decision. However, for those who were earnestly wishing and praying otherwise, his reapportionment by the president became their major disappointment and a wound that may take some time to heal.
But why did President Tinubu settle for Kyari when he had many people jostling for the job? Some stakeholders believe that Kyari’s dedication to transparency, accountability, and performance excellence which contributed significantly to NNPC’s success and Nigeria’s energy sector must have convinced the president to stick with him to allow him complete the transformational journey he had started at the NNPC.
Kyari was appointed as the 19th Group Managing Director (GMD) of the defunct Nigerian National Petroleum Corporation in July 2019 and later transitioned to the position of Group CEO of NNPCL earlier this year after the organisation’s successful incorporation as a limited liability company operating under the Companies and Allied Matters Act (CAMA) in compliance with the provisions of the Petroleum Industry Act (PIA) 2021.
With over 30 years of experience in the oil and gas sector, he has been part of NNPC since 1991 and has held various roles within the corporation. As the Group General Manager of the Crude Oil Marketing Division in 2015, Kyari made significant contributions to the success of NNPC and Nigeria.
From the time he came on board as the leader of the national oil company in 2019, Kyari’s outstanding achievements have had a positive impact on the company’s performance and reputation, definitely endearing himself to the president and his numerous admirers.
Breaking the NLNG Train 7 Jinx
Barely six months into his leadership as the NNPC GMD, Kyari had, in an audacious move in the twilight of December 2019, led the national oil company and its partners -Shell, Total and Eni to take the long-awaited Final Investment Decision (FID) for the take-off of Train 7 Project of the Nigeria Liquefied Natural Gas (NLNG) Limited.
The Train 7 project, which had been delayed for over 10 years before Kyari broke the jinx, aimed to increase the company’s production capacity from 22 million tonnes per annum (MTPA) to about 30 MTPA, and was to form part of the investment of over $10 billion, including the upstream scope of the LNG value chain.
The project followed a string of value adding decisions made under Kyari, whose leadership has focused on repositioning the oil and gas industry as articulated in the Transparency, Accountability and Performance Excellence (TAPE) agenda.
The Train 7 is expected to complement the existing six-trains and raise total production capacity by 35 per cent. NLNG currently has six trains capable of producing 22 MTPA of LNG, and five MTPA of Natural Gas Liquids (NGLs) – that is Liquefied Petroleum Gas (LPG) or cooking gas, and condensate – from 3.5 billion standard cubic feet per day (Bcf/d) of natural gas intake.
The NLNG Train 7 FID, which was signed in Abuja in the presence of the shareholders and followed by the groundbreaking ceremony held in 2020, has since re-awakened activities in the nation’s oil and gas sector after years of inactivity due to project dryness.
Commenting on the milestone at the time, Kyari had indicated that the FID ceremony was a monumental accomplishment as it signified a further demonstration of the restored and growing confidence of international oil companies of global repute in Nigeria’s petroleum space.
He added: “Secondly, and clearly, this is the result of the strong and focused leadership of His Excellency President Buhari toward the deepening and expansion of oil and gas revenues needed for national development and Growth.
“Thirdly, for us in NNPC, today’s FID is the modest result of our focused and consistent commitment toward ensuring that we deliver on our promise to Nigerians as articulated in our TAPE Agenda of enhanced transparency and Accountability, as well as performance excellence.”
He promised Nigerians to continue to expect more of “value adding decisions” from the NNPC.
“Just last week, we signed the agreement with Chevron on long dispute on EGTL in order to pave the way for further investment which we lead to increase in country gas monetization. Just a week earlier, we signed the FEED contract with Seplat on condensate refineries aimed at making Nigeria self-sufficient in gasoline and other white petroleum products productions,” he added.
He said Nigerians must appreciate the “prosperity lift” this would create, including the provision of over 10,000 direct and over 40,000 indirect jobs as well as the projected revenue of over $20 billion.
AKK Pipeline from paper to completion
On June 29, 2020 at the heat of the COVID-19 pandemic that ravaged the entire world and disrupted businesses and projects, NNPC, under Kyari defied all odds and brought the 614km Ajaokuta-Kaduna-Kano (AKK) gas pipeline project under construction after many years sitting on the shelf as mere design.
The elated former President Muhammadu Buhari, who performed the flag-off of the project had commended NNPC for its resilience in taking the bold step to deliver on the project despite the COVID-19 pandemic.
The project, according to the Kyari-led NNPC, will be inaugurated this December.
Explaining more about the project, Kyari had said the AKK gas pipeline project, which is part of the Trans-Nigeria gas pipeline project, involves the establishment of a connecting gas pipeline network that will integrate the Northern region of the country with the Niger Delta, Eastern and Western regions of the Country.
He said the EPC contract for the 614km AKK gas pipeline project was awarded at a total contract sum of $2.592 billion to Messrs. Oilserv Plc/China First Highway Engineering Company (Oilserv/CFHEC Consortium) for the first segment covering 303km.
According to the GMD NNPC, Messrs. Brentex Petroleum Services/China Petroleum Pipeline Bureau (Brentex/CPP Consortium) got the contract for the second segment covering 311km under a debt-equity financing model with loan from Bank of China and SINOSURE, to be repaid through the pipeline transmission tariff and supported by a sovereign guarantee.
‘‘We are confident that the EPC contractors will deliver the project on time, within budget and to quality/specifications,’’ he said.
Kyari added that upon completion, the project would enable the injection of 2.2bscf/d of gas into the domestic market and facilitate additional power generation capacity of 3,600MW.
Addressing Oil Production Decline
Also, NNPC under Kyari’s watch has been able to bring the activities of oil thieves and vandals relatively under control, leading to the recovery of oil production to now between 1.5 million to 1.6 million barrels per day owing to some measures put in place by the company. This included the return of the Trans-Forcados and partial restoration of the Trans Niger Pipeline (TNP).
From an all-time low of about 900,000bpd recorded in September 2022, NNPC was able to ramp up crude oil production with the collaboration of the security agencies, regulators, oil producing communities, and other stakeholders through a model it christened “the rectangular model.”
Before now, Nigeria was losing an the average of over 700,000 barrels per day from different layers including engineering losses, oil theft, as well as opportunity losses due to shutdown of facilities.
Resolving disputes on Production Share Contracts
The NNPC GCEO has optimally secured federation entitlements from production/fiscal arrangements and resolved various disputes around Production Sharing Contracts (PSCs). He has also played a key role in unlocking deepwater opportunities and introducing cost discipline in the company and industry.
For instance, in August 2022, NNPC under Kyari had signed renewed PSCs after 29 years of bickering, in a deal that could potentially boost Nigeria’s oil production substantially. The associated oil assets are expected to unlock over $500 billion in revenue for the country, attract foreign direct investment (FDIs) of around $4 billion and put an end to a continent liability of about $9 billion.
The disputed five Oil Mining Leases (OMLs) which had lingered for almost 30 years, included 128, 130, 132, 133, and 138.
Aside from the PSCs, other subcontracts included Dispute Settlement Agreements (DSAs), Settlement Repayment Agreement (SRAs), as well as Escrow Agreements.
Parties included NNPC, Total Energy, Chevron, Shell Nigeria Exploration and Production Company (SNEPCO), Esso Exploration and Production Nigeria Limited, China’s Sinopec, Equinor, Sapetro, among others.
At the official signing ceremony, Kyari had underscored the enormous losses, both in cash and goodwill that had ensued in the course of the dispute, but noted that with the matters finally settled, there would now be a boost in production.
“As you all know that in businesses, disputes are inevitable, disagreements always come when there’s no clarity of understanding of the agreements that businesses go into.
“Very often this is also complicated by laws that may not carry the necessary clarity that is required for businesses to go into contracts. And that’s how we landed in the 1993 PSC debacle. It became a major issue for all of us in the space leading to arbitration and all forms of litigation.
“And of course, as you do this, it does two things. It damages relationships, and more than anything, it stifles investment. That’s exactly what that situation brought to the table.
“We will have clearer agreements in a new PSC that must have recognised all issues that we have in the 1993 PSCs, and those clarities are there. All ambiguities have been reduced to a minimum. Of course, you can never take out ambiguities from the contacts.”
Championing transparency in NNPCL
Kyari has been instrumental in championing transparency and accountability in the company, promoted the passage of the Petroleum Industry Act (PIA) 2021, and drove the transition to NNPC Ltd.
Under his leadership, NNPC declared its first profit in 44 years and achieved numerous milestones such as public disclosure of NNPC accounts.
In August 2020, NNPC become an Extractive Industries Transparency Initiative (EITI) supporting company, joining a group of over 65 extractives companies, state-owned enterprises (SOEs), commodity traders, financial institutions and industry partners who commit to observing the EITI’s supporting company expectations.
EITI Board Chair, Hon. Helen Clark, who welcomed the company’s commitment to the EITI, had stated at the time that “NNPC plays a vital role in Nigeria’s economy. Joining the EITI as a supporting company is a welcome step in the NNPC’s journey toward achieving greater transparency and to help ensure that Nigeria’s citizens benefit from their natural resource wealth.”
NNPC has been working with the Nigeria Extractive Industries Transparency Initiative (NEITI) on an action plan to routinely disclose information, and the company currently publishes some of the data required by the 2019 EITI Standard on its website.
These disclosures demonstrate the company’s commitment to its journey to become a more transparent national oil company. Adherence to the EITI supporting company expectations will give further impetus to NNPC’s corporate vision of greater transparency and accountability. Three areas in which there is scope for advancing transparency are revenues and payments to government, contracts governing petroleum exploration and production and consolidated group-level financial statements.
Commenting on NNPC becoming an EITI supporting company, Kyari had affirmed his company’s commitment to the global transparency institution, saying “Becoming an EITI supporting company aligns with NNPC’s corporate vision and principles of transparency, accountability and performance excellence.
“Our partnership with NEITI and EITI strengthens our commitment towards commodity trading transparency, contract transparency and systematic disclosure of revenues and payments. We are on a journey towards greater transparency and look forward to deepening our collaboration with the EITI to further this work.”
However, NEITI Executive Secretary at the time, Waziri Adio, had commended NNPC’s move to support the EITI, stating that: “NNPC joining the EITI as a supporting company is a major inflection point in the quest for transparency – for the company, for Nigeria’s oil and gas sector, and for the country as a whole. This is so given how critical NNPC is to the sector and to the country.
“NEITI welcomes this bold commitment. We will continue to work and walk with NNPC to translate its espoused commitments to transparency and accountability into concrete and sustained actions and results.”
Rescuing Nigeria’s currency
In its determination to support Nigeria’s currency by arresting its free fall, NNPC recently secured a $3 billion emergency loan from the African Export-Import Bank (Afrexim-bank) to stabilise the country’s volatile foreign exchange market.
The deal was to provide some immediate disbursement that would enable the NNPC Limited to support the federal government in its ongoing fiscal and monetary policy reforms aimed at stabilising the exchange rate market.
The foreign exchange scarcity had further complicated Nigeria’s massive fuel importation, which gulps about $20 billion yearly, raising the price to as high as N617 per litre.
The new deal came over a year after the national oil company similarly secured a $5 billion corporate finance commitment from the Afrexim-bank to fund major investments in Nigeria’s upstream sector.
The deal was expected to boost foreign exchange liquidity into the country and prop up the value of the naira against the dollar.
The previous agreement was to be funded through a Forward Sale Arrangement with the delivery of 90,000 to 120,000 barrels per day to be delivered to the lender over a four to eight-year period.
Aggressive refineries rehabilitation
To pull Nigeria away from dependence on imported petroleum products with huge foreign exchange implications and economic losses, NNPC under Kyari is leading the rehabilitation of the four national refineries in Port Harcourt, Warri and Kaduna with their completion and resumption of operation expected to happen between this year and December 2024.
Aside the company’s refineries, NNPC is also supporting other private refineries to come on stream and help to achieve Nigeria’s self-sufficiency in petroleum products while making the country the hub and net exporter of refined petroleum products in Africa and beyond.
Similarly, NNPC under Kyari has managed to ensure seamless supply of petrol in the country through its efficient Direct Sale, Direct Purchase (DSDP) arrangement. He has ensured that Nigerians never suffer petrol scarcity during festive seasons, particularly Christmas period, unlike what happened during his predecessors’ leadership.
Overall, Kyari is progressively transforming NNPC into a world-class commercial and profitable entity operating with best global professional standards, amid leading concerted efforts in driving environmental policies for cleaner energy.
Analysts said these explain why President Tinubu deemed him feat and qualified to remain as the GCEO of NNPC, and the only way Kyari could return this kind presidential gesture is to keep his eyes on the ball and ensure that NNPC is further improved to deliver more values to the nation.
“He should also ensure that the targets set by the president in the area of oil and gas production growth and higher revenues are achieved through robust engagement with international oil companies and the independent firms that will lead to more investments in crucial upstream projects,” they added.
Kyari: Rewarding Performance in NNPC, Oil Sector
The reapportionment of the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited, Mallam Mele Kyari by President Bola Ahmed Tinubu is a reward for the performance of the NNPC boss which has placed the national oil company and the nation’s oil and gas industry on a positive trajectory, writes Peter Uzoho
Last week, President Bola Ahmed Tinubu, who is famous for having the knack to spot out talents and competent people reappointed the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPC), Mallam Mele Kyari to continue his performance at the company and the nation’s oil and gas sector at large.
Expectedly, the news of his reappointment elicited mixed reactions within the political and industry circles. Those who understand Kyari’s stellar performance, his enviable qualities and competences commended the president for such a wise decision. However, for those who were earnestly wishing and praying otherwise, his reapportionment by the president became their major disappointment and a wound that may take some time to heal.
But why did President Tinubu settle for Kyari when he had many people jostling for the job? Some stakeholders believe that Kyari’s dedication to transparency, accountability, and performance excellence which contributed significantly to NNPC’s success and Nigeria’s energy sector must have convinced the president to stick with him to allow him complete the transformational journey he had started at the NNPC.
Kyari was appointed as the 19th Group Managing Director (GMD) of the defunct Nigerian National Petroleum Corporation in July 2019 and later transitioned to the position of Group CEO of NNPCL earlier this year after the organisation’s successful incorporation as a limited liability company operating under the Companies and Allied Matters Act (CAMA) in compliance with the provisions of the Petroleum Industry Act (PIA) 2021.
With over 30 years of experience in the oil and gas sector, he has been part of NNPC since 1991 and has held various roles within the corporation. As the Group General Manager of the Crude Oil Marketing Division in 2015, Kyari made significant contributions to the success of NNPC and Nigeria.
From the time he came on board as the leader of the national oil company in 2019, Kyari’s outstanding achievements have had a positive impact on the company’s performance and reputation, definitely endearing himself to the president and his numerous admirers.
Breaking the NLNG Train 7 Jinx
Barely six months into his leadership as the NNPC GMD, Kyari had, in an audacious move in the twilight of December 2019, led the national oil company and its partners -Shell, Total and Eni to take the long-awaited Final Investment Decision (FID) for the take-off of Train 7 Project of the Nigeria Liquefied Natural Gas (NLNG) Limited.
The Train 7 project, which had been delayed for over 10 years before Kyari broke the jinx, aimed to increase the company’s production capacity from 22 million tonnes per annum (MTPA) to about 30 MTPA, and was to form part of the investment of over $10 billion, including the upstream scope of the LNG value chain.
The project followed a string of value adding decisions made under Kyari, whose leadership has focused on repositioning the oil and gas industry as articulated in the Transparency, Accountability and Performance Excellence (TAPE) agenda.
The Train 7 is expected to complement the existing six-trains and raise total production capacity by 35 per cent. NLNG currently has six trains capable of producing 22 MTPA of LNG, and five MTPA of Natural Gas Liquids (NGLs) – that is Liquefied Petroleum Gas (LPG) or cooking gas, and condensate – from 3.5 billion standard cubic feet per day (Bcf/d) of natural gas intake.
The NLNG Train 7 FID, which was signed in Abuja in the presence of the shareholders and followed by the groundbreaking ceremony held in 2020, has since re-awakened activities in the nation’s oil and gas sector after years of inactivity due to project dryness.
Commenting on the milestone at the time, Kyari had indicated that the FID ceremony was a monumental accomplishment as it signified a further demonstration of the restored and growing confidence of international oil companies of global repute in Nigeria’s petroleum space.
He added: “Secondly, and clearly, this is the result of the strong and focused leadership of His Excellency President Buhari toward the deepening and expansion of oil and gas revenues needed for national development and Growth.
“Thirdly, for us in NNPC, today’s FID is the modest result of our focused and consistent commitment toward ensuring that we deliver on our promise to Nigerians as articulated in our TAPE Agenda of enhanced transparency and Accountability, as well as performance excellence.”
He promised Nigerians to continue to expect more of “value adding decisions” from the NNPC.
“Just last week, we signed the agreement with Chevron on long dispute on EGTL in order to pave the way for further investment which we lead to increase in country gas monetization. Just a week earlier, we signed the FEED contract with Seplat on condensate refineries aimed at making Nigeria self-sufficient in gasoline and other white petroleum products productions,” he added.
He said Nigerians must appreciate the “prosperity lift” this would create, including the provision of over 10,000 direct and over 40,000 indirect jobs as well as the projected revenue of over $20 billion.
AKK Pipeline from paper to completion
On June 29, 2020 at the heat of the COVID-19 pandemic that ravaged the entire world and disrupted businesses and projects, NNPC, under Kyari defied all odds and brought the 614km Ajaokuta-Kaduna-Kano (AKK) gas pipeline project under construction after many years sitting on the shelf as mere design.
The elated former President Muhammadu Buhari, who performed the flag-off of the project had commended NNPC for its resilience in taking the bold step to deliver on the project despite the COVID-19 pandemic.
The project, according to the Kyari-led NNPC, will be inaugurated this December.
Explaining more about the project, Kyari had said the AKK gas pipeline project, which is part of the Trans-Nigeria gas pipeline project, involves the establishment of a connecting gas pipeline network that will integrate the Northern region of the country with the Niger Delta, Eastern and Western regions of the Country.
He said the EPC contract for the 614km AKK gas pipeline project was awarded at a total contract sum of $2.592 billion to Messrs. Oilserv Plc/China First Highway Engineering Company (Oilserv/CFHEC Consortium) for the first segment covering 303km.
According to the GMD NNPC, Messrs. Brentex Petroleum Services/China Petroleum Pipeline Bureau (Brentex/CPP Consortium) got the contract for the second segment covering 311km under a debt-equity financing model with loan from Bank of China and SINOSURE, to be repaid through the pipeline transmission tariff and supported by a sovereign guarantee.
‘‘We are confident that the EPC contractors will deliver the project on time, within budget and to quality/specifications,’’ he said.
Kyari added that upon completion, the project would enable the injection of 2.2bscf/d of gas into the domestic market and facilitate additional power generation capacity of 3,600MW.
Addressing Oil Production Decline
Also, NNPC under Kyari’s watch has been able to bring the activities of oil thieves and vandals relatively under control, leading to the recovery of oil production to now between 1.5 million to 1.6 million barrels per day owing to some measures put in place by the company. This included the return of the Trans-Forcados and partial restoration of the Trans Niger Pipeline (TNP).
From an all-time low of about 900,000bpd recorded in September 2022, NNPC was able to ramp up crude oil production with the collaboration of the security agencies, regulators, oil producing communities, and other stakeholders through a model it christened “the rectangular model.”
Before now, Nigeria was losing an the average of over 700,000 barrels per day from different layers including engineering losses, oil theft, as well as opportunity losses due to shutdown of facilities.
Resolving disputes on Production Share Contracts
The NNPC GCEO has optimally secured federation entitlements from production/fiscal arrangements and resolved various disputes around Production Sharing Contracts (PSCs). He has also played a key role in unlocking deepwater opportunities and introducing cost discipline in the company and industry.
For instance, in August 2022, NNPC under Kyari had signed renewed PSCs after 29 years of bickering, in a deal that could potentially boost Nigeria’s oil production substantially. The associated oil assets are expected to unlock over $500 billion in revenue for the country, attract foreign direct investment (FDIs) of around $4 billion and put an end to a continent liability of about $9 billion.
The disputed five Oil Mining Leases (OMLs) which had lingered for almost 30 years, included 128, 130, 132, 133, and 138.
Aside from the PSCs, other subcontracts included Dispute Settlement Agreements (DSAs), Settlement Repayment Agreement (SRAs), as well as Escrow Agreements.
Parties included NNPC, Total Energy, Chevron, Shell Nigeria Exploration and Production Company (SNEPCO), Esso Exploration and Production Nigeria Limited, China’s Sinopec, Equinor, Sapetro, among others.
At the official signing ceremony, Kyari had underscored the enormous losses, both in cash and goodwill that had ensued in the course of the dispute, but noted that with the matters finally settled, there would now be a boost in production.
“As you all know that in businesses, disputes are inevitable, disagreements always come when there’s no clarity of understanding of the agreements that businesses go into.
“Very often this is also complicated by laws that may not carry the necessary clarity that is required for businesses to go into contracts. And that’s how we landed in the 1993 PSC debacle. It became a major issue for all of us in the space leading to arbitration and all forms of litigation.
“And of course, as you do this, it does two things. It damages relationships, and more than anything, it stifles investment. That’s exactly what that situation brought to the table.
“We will have clearer agreements in a new PSC that must have recognised all issues that we have in the 1993 PSCs, and those clarities are there. All ambiguities have been reduced to a minimum. Of course, you can never take out ambiguities from the contacts.”
Championing transparency in NNPCL
Kyari has been instrumental in championing transparency and accountability in the company, promoted the passage of the Petroleum Industry Act (PIA) 2021, and drove the transition to NNPC Ltd.
Under his leadership, NNPC declared its first profit in 44 years and achieved numerous milestones such as public disclosure of NNPC accounts.
In August 2020, NNPC become an Extractive Industries Transparency Initiative (EITI) supporting company, joining a group of over 65 extractives companies, state-owned enterprises (SOEs), commodity traders, financial institutions and industry partners who commit to observing the EITI’s supporting company expectations.
EITI Board Chair, Hon. Helen Clark, who welcomed the company’s commitment to the EITI, had stated at the time that “NNPC plays a vital role in Nigeria’s economy. Joining the EITI as a supporting company is a welcome step in the NNPC’s journey toward achieving greater transparency and to help ensure that Nigeria’s citizens benefit from their natural resource wealth.”
NNPC has been working with the Nigeria Extractive Industries Transparency Initiative (NEITI) on an action plan to routinely disclose information, and the company currently publishes some of the data required by the 2019 EITI Standard on its website.
These disclosures demonstrate the company’s commitment to its journey to become a more transparent national oil company. Adherence to the EITI supporting company expectations will give further impetus to NNPC’s corporate vision of greater transparency and accountability. Three areas in which there is scope for advancing transparency are revenues and payments to government, contracts governing petroleum exploration and production and consolidated group-level financial statements.
Commenting on NNPC becoming an EITI supporting company, Kyari had affirmed his company’s commitment to the global transparency institution, saying “Becoming an EITI supporting company aligns with NNPC’s corporate vision and principles of transparency, accountability and performance excellence.
“Our partnership with NEITI and EITI strengthens our commitment towards commodity trading transparency, contract transparency and systematic disclosure of revenues and payments. We are on a journey towards greater transparency and look forward to deepening our collaboration with the EITI to further this work.”
However, NEITI Executive Secretary at the time, Waziri Adio, had commended NNPC’s move to support the EITI, stating that: “NNPC joining the EITI as a supporting company is a major inflection point in the quest for transparency – for the company, for Nigeria’s oil and gas sector, and for the country as a whole. This is so given how critical NNPC is to the sector and to the country.
“NEITI welcomes this bold commitment. We will continue to work and walk with NNPC to translate its espoused commitments to transparency and accountability into concrete and sustained actions and results.”
Rescuing Nigeria’s currency
In its determination to support Nigeria’s currency by arresting its free fall, NNPC recently secured a $3 billion emergency loan from the African Export-Import Bank (Afrexim-bank) to stabilise the country’s volatile foreign exchange market.
The deal was to provide some immediate disbursement that would enable the NNPC Limited to support the federal government in its ongoing fiscal and monetary policy reforms aimed at stabilising the exchange rate market.
The foreign exchange scarcity had further complicated Nigeria’s massive fuel importation, which gulps about $20 billion yearly, raising the price to as high as N617 per litre.
The new deal came over a year after the national oil company similarly secured a $5 billion corporate finance commitment from the Afrexim-bank to fund major investments in Nigeria’s upstream sector.
The deal was expected to boost foreign exchange liquidity into the country and prop up the value of the naira against the dollar.
The previous agreement was to be funded through a Forward Sale Arrangement with the delivery of 90,000 to 120,000 barrels per day to be delivered to the lender over a four to eight-year period.
Aggressive refineries rehabilitation
To pull Nigeria away from dependence on imported petroleum products with huge foreign exchange implications and economic losses, NNPC under Kyari is leading the rehabilitation of the four national refineries in Port Harcourt, Warri and Kaduna with their completion and resumption of operation expected to happen between this year and December 2024.
Aside the company’s refineries, NNPC is also supporting other private refineries to come on stream and help to achieve Nigeria’s self-sufficiency in petroleum products while making the country the hub and net exporter of refined petroleum products in Africa and beyond.
Similarly, NNPC under Kyari has managed to ensure seamless supply of petrol in the country through its efficient Direct Sale, Direct Purchase (DSDP) arrangement. He has ensured that Nigerians never suffer petrol scarcity during festive seasons, particularly Christmas period, unlike what happened during his predecessors’ leadership.
Overall, Kyari is progressively transforming NNPC into a world-class commercial and profitable entity operating with best global professional standards, amid leading concerted efforts in driving environmental policies for cleaner energy.
Analysts said these explain why President Tinubu deemed him feat and qualified to remain as the GCEO of NNPC, and the only way Kyari could return this kind presidential gesture is to keep his eyes on the ball and ensure that NNPC is further improved to deliver more values to the nation.
“He should also ensure that the targets set by the president in the area of oil and gas production growth and higher revenues are achieved through robust engagement with international oil companies and the independent firms that will lead to more investments in crucial upstream projects,” they added.
Source: Thisday
