27/06/2015

Why NNPC board was dissolved

                       NEW GMD NNPC


Only a few undiscerning  Nigerians and foreigners would have been surprised  by the dissolution,yesterday,of the board of the    Nigerian National Petroleum Corporation (NNPC) by President Muhammadu Buhari.

For as long as anyone can remember,the organization has  been stumbling from one corruption scandal  to the other,the latest  being the 2013 allegation by the immediate past Governor of the Central bank of Nigeria (CBN) and now the Emir of Kano,Alhaji Muhammadu Lamido Sasusi ,that the NNPC failed to remit  up to $20 billion to the federation account.


The allegation was to cost him his job at the apex bank even after forensic auditors appointed by the immediate past administration  said only $1.4billion should be remitted by the  firm.

The NNPC   was established on April 1, 1977 following the  merger of the  then Nigerian National Oil Corporation and the Federal Ministry of Mines and Steel with sole responsibility for upstream and downstream developments.

It  is also charged with regulating and supervising the oil industry on behalf of the Federal  Government.

Eleven years after   the birth of the  NNPC  it was  commercialised into 11 strategic business units, covering the entire spectrum of oil industry operations: exploration and production, gas development, refining, distribution, petrochemicals, engineering, and commercial investments.

It  manages the joint ventures between the federal government  and such foreign multinational corporations like Royal Dutch Shell, Agip, ExxonMobil, Chevron, and Texaco (now merged with Chevron).

Through collaboration with these companies, the Nigerian government conducts petroleum exploration and production.

The oil companies  appropriate portions of their revenue which is  nearly 60% of the revenue generated by the oil industry in this manner,to the government.

With oil as Nigeria’s largest revenue earner,cash flow from the NNPC accounts for 76% of federal government revenue and 40% of the entire country’s GDP.

But in reality,the corporation and many of its subsidiaries have failed in living up to their responsibilities.

Its refineries hardly work with the result that Nigeria relies more on imported fuel .

Thus, scarce foreign  exchange is wasted on importing fuel while billions of naira is also paid as ‘subsidy’ to importers.

This mode  of business has since been found to be  a huge racket  on the nation.

Several of such fuel importers are currently standing trial for defrauding  the country and Nigerians are not likely to forget in a hurry their recent harrowing experience when the importers  refused to do business.

The ‘missing’ $20billion was a major dent on the reputation of the last government even if its key actors refuse to admit it.

Nigerians are angry with the NNPC on account of its operations and alleged corruption.

Most of the misgivings concern  the ‘missing’ $20billion and  perveived  mismanagement and abuse of the Petroleum Support Fund otherwise known as oil subsidy and lack of transparency .

They are clamouring for its removal and  probe of those that managed the fund.

With the then President-elect Muhammadu Buhari vowing in April to revisit   the ‘missing’ money issue,his anti-corruption reputation,and his vast knowledge of the oil and gas industry,it was to be expected that he would have  more than a  passing interest in the sector on his assumption of office.

Observers believe that the NNPC dissolution is just a prelude to what is to come from Buhari in the industry.

It should not be a surprise if he orders an inquisition into what is generally perceived as the financial indiscretion of successive administrations in the organization.

He may not even limit the looming probe to the ‘missing’ $20billion.

Nigerians and foreigners are asking questions on   other corruption related allegations against NNPC like  the  over $1million  bribes which  ABB Vetco Gray, a US company, and its UK subsidiary ABB Vetco Gray UK Ltd,  claimed to have paid to officials at NNPC subsidiary NAPIMS in exchange for obtaining confidential bid information and favourable recommendations from Nigerian government agencies;  the over $6.3million allegedly paid by another US company Willbros Group Inc,  to officials at the NNPC and its subsidiary NAPIMS, in return for assistance in obtaining and retaining contracts for work on the Eastern Gas Gathering System (EGGS);and  the allegation by the  Swiss Non-governmental advocacy organization – Erklärung von Bern -  of heavy fraud surfaced, placing the NNPC under suspicion of siphoning off $6.8 billion in crude oil revenues.

The sacked board headed by the immediate Petroleum Minister Diezani Alison-Madueke had as members  the Group Managing Director of the corporation, Dr. Joseph Dawha, Group Executive Director, Finance & Accounts, Mr. Bernard O.N. Otti – Group Executive Director, Corporate Services, Dr. Dan Efebo , Coordinator, Legal Services/ Secretary to the Corporation, Ikechukwu Oguine and other five members : Alhaji Abdullahi Bukar , Mr. Danladi Wadzani, Prof. Olusegun Okunnu , Mr. Danladi Kifasi and  Mr. Steven Oronsaye.

The NNPC  was scheduled to hold its Group Executive Council meeting on Wednesday but shifted it to the following day.It never happened still.

What followed was the  summon of the GMD to the Presidency yesterday to be told of the board dissolution.




Credit: thenationonlineng.net/


No comments:

Post a Comment