By MBAFAN ADE, Abuja –
The Nigerian National Petroleum Company Limited (NNPC Ltd), has restated plans to issue its Initial Public Offer (IPO) to investors very soon.
Group Chief Executive Officer (GCEO) of NNPC Ltd, Mele Kyari said this at the 22nd edition of the 2023 Nigeria Oil and Gas (NOG) Energy conference and Exhibition on Tuesday in Abuja.
Mele-Kyari-Speaking
The News Agency of Nigeria (NAN)reports that the theme of the conference is, “Powering Nigeria’s Sustainable Energy Future.”
Kyari spoke just as the Senate also on Tuesday constituted an ad hoc committee to investigate the fuel subsidy regime of the NNPCL.
This followed the adoption of a motion by Sen. Patrick Chinwuba (APC-Imo) during plenary on Tuesday.
The motion was tagged “Need to Investigate the Controversial Huge Expenditure on Premium Motor Spirit (PMS) under the Subsidy/Under Recovery Regime by the Nigerian National Petroleum Company Limited (NNPCL).”
Kyari while speaking on” Redefining Nigeria’s Energy Landscape for a Sustainable Energy Future,’’ said the decision was based on the law.
He said:” As a Company that it is guided under the regulations of the Companies and Allied Matters Act, the NNPC Ltd.will declare its shares to the public for acquisition very soon.
“We will pay taxes; we will pay royalties like anyone; we will also pay dividends to our shareholders which many of you are.
” We are in business and business means competition. We are a private sector, forget about the fact that we are owned by the government 100 per cent.
“You are also aware, we are going Initial Public Offer very soon, we will sell a part of our equity.
” It is in the law, and once that happens, we will not be any different for any of you and it will be a very different business environment.”
On subsidy removal, kyari said it had ensured positive change in the sector by freeing up capital for powering the sustainable supply of energy.
“Are we positioned to facilitate business? Yes, but our partnership produced over 80 per cent of the oil and gas in the country either directly or through our off stream company or through our partnership.
“I am in a position to facilitate business. On the PSC today, we are just agents of the state, trying to make sure we deliver value to them and then they will pay.
“I am sure you appreciate this new relationship. The PSCs are not on the balance sheet on the NNPCL.
” We make sure you do your work because when you do, we are compensated 40 per cent of your profit oil, so it is important for us as well as business for us,”he said.
On energy poverty, the NNPCL boss said the focus was now to ensure that more people had access to energy.
Kyari said, “Over 30 per cent do not have access to electricity. So, is energy available or is it the problem of affordability.
” Or it is that we have an unsustainable situation or is it combination of all of them? I think we are dealing with the combination of all.”
According to him, energy is not available, it is not affordable in definite sense.
He said this was due to many structures and issues that made affordability a matter of concern for everybody.
“We supply gas, we do not get payment for it; We supply power and we do not get payment for it.
” So, you cannot run any business this way. You cannot be sustainable. You cannot create affordable energy and it will not be available.”
According to him, affordability, accessibility and sustainability are the drivers of Nigeria’s energy future.
He said that key initiatives on the horizon for NNPCL would include expanding gas infrastructure to deliver gas across West Africa and potentially, Europe.
He further said expansion of liquefaction capacity of NLNG and enabling availability of LPG as a cooking fuel and CNG as alternative fuel for automobiles were paramount.
Kyari then reiterated the need to bridge the skilled manpower gap, ensure asset security, and invest in infrastructure to transform challenges into opportunities.
NAN reports that the NOG Energy Week is Nigeria’s foremost international energy conference aimed at discussing policy implementation, vital energy agenda and investments, among others.
The ongoing event was attended by policymakers, regulators, leaders, stakeholders and partners of the industry.
SENATE PROBE:
Moving the motion, Chinwuba said that the Federal Government on May 11, 2016 announced increase in fuel pump price from N87 to between N135 and N145 per litre.
“This was in its fight against corruption and in order to plug the presumed highly proliferated leakages, wastage and slippages surrounding the fuel subsidy as well as in an attempt to end the controversial subsidy regime.
“At the inauguration of the present government on May 29, the President took a bold step to announce the total removal of fuel subsidy, noting that the scheme has increasingly favoured the rich more than the poor,” he said.
He said that the government’s interest in exiting the subsidy regime was in line with the policy of reducing cost of governance and the desire to eliminate corrupt practices surrounding the scheme.
“The NNPCL within the period of subsidy exit attempt, substituted the term subsidy with under recovery without any recourse to the National Assembly or supervision by any other arm of the government.
“While NNPCL within 10 years, 2006 and 2015, claimed about N170 billion as under recovery, the same NNPCL within 13 months, Jan. 2018 to Jan. 2019 claimed a whopping sum of N843.121 billion as under recovery,” he said.
The lawmaker expressed worry that the uninvestigated and alarming cost of under recovery/direct deductions by NNPCL without necessary checks, had led to great misunderstanding of the government’s good intention on subsidy removal.
Supporting the motion, Sen. Jibrin Isa (APC-Kogi) said that the utilisation of the savings arising from the removal of subsidy was very important.
“This is where our oversight function comes to play.
“These monies that are going to be recovered from the discontinuance of fuel subsidy should be used to revive some of the ailing companies in particular; the Ajaokuta Steel Complex, Itakpe Iron Ore Mining Company in Kogi and Oshogbo Iron and Steel Rolling Mills in Osun.
“Those projects can create a lot of employment opportunities, create a lot of revenue for government,” he said.
Also, Sen. Osita Izunaso (APC-Imo) said “we need to look at the palliatives to cushion the effects of subsidy removal.
“Much as we are going to make a lot of gains from subsidy removal, we have to look at the suffering of our people.”
Sen. Mohammed Monguno (APC-Borno) said that previous government did not had the political will to withdraw the subsidy.
“We thank this government for taking the bull by the horn and gathering all the political will to withdraw the subsidy in the interest of Nigerians.
“We are now saving a lot of money which we can use to deploy for revamping our infrastructure.
“In view of the hardship unleashed on Nigerians as a result of the subsidy, there is the need for government to take responsibility in cushioning the effect of the removal,” he said.
The prayers were unanimously adopted by all senators after a voice vote by Senate President Godswill Akpabio.
(With a report by NAN)
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