In 2022, the Nigerian National Petroleum Company (NNPC) Limited will undoubtedly be more efficient and transparent as a result of its successful transformation.
Throughout the decades, the national oil company has undergone many changes and transformations. The Nigerian National Oil Corporation (NNPC), now renamed Nigerian National Company (NNPC) Limited, has been on a transformation train since its inception on April 1, 1977, as a merger of the Nigerian National Oil Corporation (NNOC) and the Federal Ministry of Petroleum and Energy Resources.
The changes and unprecedented deluge of reformations in 2021, according to a document obtained by The Guardian, speak volumes when compared to previous attempts to restructure the corporation.
The corporation would become a commercialised national oil company under the new Petroleum Industry Act (PIA), which enshrines TAPE (Transparency, Accountability, and Performance Excellence) in NNPC.
“TAPE is widely promoted as a strategic roadmap for NNPC to achieve efficiency and global excellence in order to put the Corporation on a profitable path.” It also aims to transform NNPC and boost its potential and capacity to compete with other national oil companies around the world.
“Among other things, this strategy aims to make NNPC more operationally transparent and accountable, benchmark NNPC against established global best practices, and establish the right cost optimization structure,” it said.
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Mele Kyari, the Group Managing Director of NNPC, said the national oil company has been transformed into a more competitive and commercial entity, which will continue to deliver value and dividends to its shareholders, as he reflected on the company’s achievements last year.
The PIA, according to Kyari, has provided several opportunities for attracting investment to the sector, which NNPC and its subsidiaries will take advantage of to boost profits.
The NNPC boss said the corporation’s declaration of a profit of N287 billion in 2020 was a testament to the management’s cost effectiveness.
In 2021, he stated that the new NNPC Ltd’s drive for efficiency, effectiveness, and accountability paid off immediately, with the company posting a profit for the first time in 44 years.
The company promised to build on its success in 2021 to achieve even greater operational excellence in 2022. The FID on a $3.6 billion methanol plant in Bayelsa; execution of a $260 million funding agreement for ANOH Gas Processing Company Limited (AGPC) between the NNPC, Seplat, and a consortium of seven banks; launch of Nigerian Upstream Cost Optimization Programme (NUCOP); award of $1.5 billion contract for refinery rehabilitation in Port Harcourt; commercialization of OML 143 gas; and execution of a $260 million funding agreement for ANOH Gas Processing Company Limited (
Other agreements include a shareholder agreement for the Brass Petroleum Product Terminal (BPPT) and an Engineering, Procurement, and Construction (EPC) contract for the Maiduguri Emergency Power Project, in which NNPC partnered with China Machinery Engineering Company (CMEC) and General Electric (GE) to execute an EPC contract for the procurement of equipment for a 50 MW emergency power project in Maiduguri, Borno State.
The corporation stated in 2021 that it was able to maintain petroleum product supply by leveraging its existing Direct-Sales-Direct-Purchase (DSDP) product supply arrangement to stop the country’s incessant petroleum product supply disruptions.
The corporation stated in its Final Investment Decision (FID) for the $3.6 billion methanol plant in Bayelsa that the facility, which would be Africa’s largest and first, would create 35,000 direct and indirect jobs, as well as an additional 5,000 permanent jobs during the operations phase.
The plant, which will be operational in 2024 and is an integrated methanol and gas project in Odioma, Brass Island, Bayelsa State, is expected to produce 10,000 tons of methanol per day.
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It did, however, pledge to build or rehabilitate 21 roads as part of the Federal Government’s Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme.
The Federal Executive Council (FEC) has approved N621.2 billion for the Nigerian National Petroleum Corporation (NNPC) to take over the reconstruction of 21 federal roads across the country’s six geopolitical zones.
The federal government’s Road Infrastructure and Refreshment Tax Credit Scheme calls for the construction and rehabilitation of the selected roads as a strategic intervention.
