NNPC, BARU AND MATTERS ARISING

Things could be done better in NNPC, writes Mfom Bassey-Wellington

The August 31, 2017 letter from the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, complaining of the insubordination of the Nigerian National Petroleum Corporation (NNPC) Group Managing Director, Dr Maikanti Baru, began to generate ripples less than 24 hours after it was made available to the media. The Senate, for example, the next day resolved to set up an ad hoc committee to investigate grave allegations against the NNPC chief executive. The decision followed a motion by Senator Samuel Anyanwu asking for a probe into the enormous and constant jobs given to Duke Energy, a motion which Senator Kabiru Marafa successfully prayed the Senate to include an investigation into the charge that Dr. Baru has awarded $25bn contracts without due process.

In the letter to President Muhammadu Buhari, Kachukwu, who is also the chairman of the NNPC Board of Directors, revealed that the NNPC GMD has since his appointment sidelined him in the affairs of the organisation. He cited the example of recent appointments as part of the NNPC reorganisation done without his knowledge, as he read about the changes only in the media, like any other person. The irony is that the appointments were made shortly after the corporation’s board held a meeting which, presumably, Baru attended. In other words, he did not deem it fit to intimate the board of the impending development.

I do not think that anyone doubts that Baru has been carrying on as if the Minister of State does not exist and as if he is no longer the NNPC board chair. The justification provided by his supporters is that Kachukwu sidelined him when the latter was the NNPC MD, by making him a technical assistant in the Ministry of Petroleum Resources. In other words, Baru is getting his pound of flesh against Kachikwu.

Mr President, there are serious consequences to the nation when key public officers trivialise their positions and make the nation go through avoidable political and social turbulences. Take the recent appointment of 55 NNPC executives which generated a nationwide brouhaha. The South-South geopolitical zone from which most of Nigeria’s crude oil and gas resourced are produced managed to get only two positions while the Southwest received three in the first round of appointments announced. While 10 persons were appointed from the North, not even one person was deemed fit to be appointed from the Southeast in the restructuring. Appointments like this tend to portray the Buhari administration as very sectional. They make Nigerians lose confidence in not just the administration but also the country itself.

It is self-evident that Dr. Kachukwu was not privy to the appointments. Yet, here is someone who has been working round the clock to provide peace in the Niger Delta. He made peace in the region a priority right from the moment he assumed office. The result is that Nigeria now produces up to two million barrels of crude oil per day. Huge resources are no longer spent on repairing gas and oil pipelines blown up by militants protesting against the marginalisation of the region. Nor are cases of kidnapping for ransom rampant in the zone any longer.

Indeed, the NNPC management’s penchant for ignoring the NNPC board chairman cum minister of state has more dangerous ramifications than many Nigerians seem to know. There is, for example, a clear case of outright misleading of the President by the NNPC GMD. On December 20, 2016, Baru sent a memo to the president urging him to cancel Oil Mining Lease (OML) 13 on the ground that it originally belonged to the Nigerian Petroleum Development Company (NNPD), but was “inadvertently revoked” in 2006 by President Olusegun Obasanjo, who was to convert it into four oil blocks. The presentation was, of course, based on a complete fabrication. OML 13, which is within Ogoniland, never belonged to the NPDC. It rather belonged to Shell, but the company could not operate it for 12 years because it was sacked from Ogoniland by the Ogoni people who suspected that Shell had a hand in the killing of Ken Saro-Wiwa in 1995.

Obasanjo did not like the fact that this huge national asset had wasted for over a decade, and so resized it into four blocks which were subsequently put up for bidding in the 2007 round. OPL 202, for instance, went to Hi Rev, a Nigerian energy firm with American technical partners, which bidded $66m for it. Hi Rev has been keenly interested in building Nigeria’s first modular refinery, which is now 40% completed. Located on top of the Utapate Oilfield in Ibolo East Local Government Area of Akwa Ibom State, the $150m modular refinery capable of producing 50,000 bpd on completion is designed to produce premium motor spirit (PMS), popularly known as petrol; automotive gas oil (AGO), better known as diesel; dual purpose kerosene (DPK), often referred to as kerosene; and JET-A1, better known as aviation fuel.

The fate of this modular refinery is, however, now hanging in the balance. Dr. Baru deliberately misled President Buhari to cancel the OPL 202 licence last December 20 on the spurious allegation that it was originally an NPDC asset, whereas the NPDC did not ever have anything to do with it. Baru succeeded because neither the Minister of State for Petroleum Resources, Dr Kachikwu, nor the Attorney General of the Federation and Minister of Justice, Malam Abubakar Malami, was aware of Baru’s move. Everything was done secretly. It is, indeed, curious that the memo was presented to President Buhari on December 20, when almost everyone was set to go on Christmas and New Year holidays, and approved the same day! To worsen matters, there was not even one change, nor was a query raised for clarification of any issue.

OPL 202 was not the only acreage which President Buhari invalidated last December 20. OPLs 201, 203 and 2004, all resized from OML 13, were also affected. By perhaps sheer coincidence, these were the only oil blocks won by firms promoted by Niger Delta persons in the 2007 bidding round. And the people of the region are naturally mad like hell at the cancellation. They have so far been held in check the promoters of the firms which won the affected acreages. How long can the restive people be kept in check?

While urging the president to look into the misadvised cancellation of OPLs OPLs 201, 202, 203 and 204, there is a critical need to make the NNPC GMD respect hierarchy by carrying key government officials along in policy matters. The failure to carry the Minister of Justice along in the cancellation of OPLs 201, 202, 203 and 204 has resulted in litigation and, more importantly, in a high degree of uncertainty in the Niger Delta. We cannot gloss over the fact that developments like the controversial NNPC executive appointments announced last August 30, which are heavily lopsided, are costing this administration tremendous political capital. Things could be done better in the NNPC. Mrs Bassey-Wellington is executive director of an oil servicing firm in Eket, Akwa Ibom State

THE NNPC MANAGEMENT’S PENCHANT FOR IGNORING THE NNPC BOARD CHAIRMAN HAS MORE DANGEROUS RAMIFICATIONS THAN MANY NIGERIANS SEEM TO KNOW. THERE IS, FOR EXAMPLE, A CLEAR CASE OF OUTRIGHT MISLEADING OF THE PRESIDENT BY THE GMD. ON DECEMBER 20, 2016, BARU SENT A MEMO TO THE PRESIDENT URGING HIM TO CANCEL OIL MINING LEASE (OML) 13 ON THE GROUND THAT IT ORIGINALLY BELONGED TO THE NIGERIAN PETROLEUM DEVELOPMENT COMPANY, BUT WAS ‘INADVERTENTLY REVOKED’ IN 2006 BY PRESIDENT OBASANJO, WHO WAS TO CONVERT IT INTO FOUR OIL BLOCKS