Dr. Ibe Kachukwu, Minister of State for Petroleum Resources, has explained that the Federal Government has not unbundled Nigerian National Petroleum Corporation (NNPC) yet as widely reported on Tuesday.
However, rising from the Federal Executive Council (FEC) meeting Wednesday, Kachikwu explained that what the corporation did was not unbundling but mere re-organisation.
He told State House correspondents after the FEC meeting at the Presidential Villa, Abuja, as the Group Managing Director (GMD) of NNPC that the corporation’s re-organisation so far ended with five business units, but that NNPC is still intact as a corporate entity.
In Kachikwu’s words: “We have not unbundled NNPC. We held a press conference (Tuesday), where I explained this. What we have simply done is re-organisation. We have five business entities focused on business: Upstream, Downstream, Refineries, Gas and Power that are there before.
“There are also Ventures that capture all our little companies that were not having proper stewardship. They are run by individuals who report to the GMD.
“The NNPC is still a whole. There is nothing new that has happened.”
Senate, oil and gas workers kick
But the Senate and workers’ unions in the oil and gas sector were Wednesday up in arms against the Federal Government’s unbundling of NNPC. The protest paralyzed activities in the corporation. Both the National Assembly and the workers accused the Federal Government of violating the law establishing the NNPC.
According to them, the corporation was established through the Nigerian National Petroleum Corporation, NNPC, Act of 1977. The NNPC Act specifically states that the Act or any part thereof can only be altered, changed or otherwise amended by the Act of the National Assembly.
“It is also stated in CAP N123, laws of the Federation, 2004 that the NNPC is a creature of legislature; the NNPC Act or any part thereof can only be altered, changed or otherwise amended by an Act of the National Assembly.
While the Senate declared the action illegal and had begun probe of President Muhammadu Buhari’s decision to undertake the unbundling, the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and National Union of of Petroleum and Natural Gas Workers (NUPENG) shut NNPC offices in protest against the move, sparking off fears of worsening fuel scarcity.
There were, however, discordant tunes in the House of Representatives as some members kicked against the unbundling, while others saw nothing wrong with it.
Senate Chief Whip, Senator Olusola Adeyeye (APC, Osun Central), in a point of order on the floor of the Senate, drew the attention of other senators to the unbundling of the nation’s agency in charge of the oil and gas sector in the country.
Adeyeye, who will formally present a motion on the matter Thursday, where there would be extensive debate at the plenary, described the exercise as illegal as the federal government did not consult with the National Assembly to repeal the enabling law that set up NNPC before breaking it into different components.
Senator Adeyeye said: “We cannot afford a strike at this time and the reason for the strike is because the NNPC has been unbundled, broken into parts that are not known to the laws which established the NNPC.
“The NNPC was established with a definite purpose and a definite structure to carry out that purpose. Throughout the last National Assembly, we worked very hard on the PIB bill so as to give our petroleum sector an effective structure; we are still working on that. I don’t think any director of any parastatal should act outside of the law.
“I, therefore, seek the permission of the Presidency of this senate and distinguished members that I raise the matter (today) for consideration.”
NUPENG, PENGASSAN protest
Meanwhile, all operations of the NNPC were shut by protesting workers as a result of the unbundling. The workers, acting on the platform of NUPENG and PENGASSAN, shut the gates leading to the NNPC Towers as early as 6.30am and prevented movement in and out of the towers.
The workers said they were not against the unbundling, but insisted that it must be done in accordance with the law of the land and that all stakeholders, especially PENGASSAN and NUPENG, must be carried along.
He lamented that the government did not take into consideration the existing law that established the NNPC before unbundling the corporation and called for an all-inclusive stakeholders’ forum where all issues confronting the industry could be resolved.
Okugbawa said: “The NNPC was established through the Nigerian National Petroleum Corporation, NNPC, Act of 1977. The NNPC Act specifically states that the Act or any part thereof can only be altered, changed or otherwise amended only by the Act of the National Assembly.
“It is also started in CAP N123, laws of the Federation, 2004 that the NNPC is a creature of legislature; the NNPC Act or any part thereof can only be altered, changed or otherwise amended by an Act of the National Assembly.
“This Act has many provisions that deal with structure and operations of the corporation. There are many issues such as pensions and transfer of the employees, which were provided for in the NNPC Act of 1977. What will happen to all these provisions of the law?
“For the government to do anything with the current NNPC, the Act must either be repealed or amended. If not, it will amount to lack of respect for the rule of law on the part of the government.
“There is the issue of the Petroleum Industry Bill, PIB, expected to be the legal instrument for the ongoing reforms of the oil and gas industry. This will be meaningless if the government should introduce plans outside the reforms, The PIB is germane to the development of the nation’s oil and gas industry.
“Above all, the various stakeholders, especially the unions were shocked to receive the news as every other Nigerian. There is confusion everywhere, no direction, no explanation about anything. What happens to the head of subsidiaries like Petroleum and Products Marketing Company, PPMC, National Petroleum Investment and Management Services, NAPIMS, even the refineries?”
House of Reps divided
But there were discordant tunes among members of the House of Representatives over the decision by NUPENG and PENGASSAN to embark on strike, following the unbundling.
While the member representing Okitipupa/Irele Federal Constituency of Ondo State, Micheal Adeniyi Omogbehin and Gabriella Omosede Igbinedion representing Ovia North East/South-West Federal Constituency of Edo State condemned the minister for being hasty in carrying out the proposal, Philip Shaibu representing Etsako Federal Constituency of Edo State, said the minister had not violated any law.
Omogbehin specifically wondered why the minister was in a hurry when the House of Representatives on Tuesday called for a suspension of the proposal, pending when it’s relevant committees on oil and gas submitted its report on the matter.
He said that the House which he described as Nigerian House had taken a decision, asking the minister to halt the proposal to unbundle the NNPC, pending when the committees should submit their reports but expressed surprise the minister ignored the resolution of the House.
His position was supported by Igbinedion, who wondered what it would remove from the minister if he should suspend implementation of the proposed unbundling of the NNPC, pending when the relevant committees concluded their investigations and submit their reports.
But Shaibu differed with his colleagues as he said that the proposal was for administrative convenience and effective management of NNPC, adding that there was no law known to him that had been violated.
He said: “I think what to my knowledge is the meaning of unbundling, according to the minister, is for efficiency and proper management of that establishment, knowing that it is the hallmark of revenue generation, the life wire of this country.
“It must be taken seriously more so with the level of corruption and mismanagement that have taken place in NNPC. There are lots of misnomer in NNPC that are already being investigated. Looking at what he has done from my perspective, it was just to create an avenue where he can manage effectively and also take advantage of enormous resources in this country and make sure that nothing is lost.
“By my little investigation so far, the Act of 1977 establishing the NNPC, does not have any where it stipulated how to unbundle NNPC as he has done. For me, I call it demarcation like he has done. The law, so far as I have seen, has not been offended.”
It’s mere re-organisation – Kachikwu
However, rising from the FEC meeting, yesterday, the Minister of State for Petroleum Resources, Mr. Ibe Kachukwu, stated that government has not unbundled the NNPC yet.
Explaining the development in the oil sector in an interview with State House correspondents after the meeting of the Federal Executive Council at the Presidential Villa, Abuja, the minister, who is also the Group Managing Director, GMD of NNPC, said what the corporation did was re-organisation.
He said: “We have not unbundled NNPC. We had a press conference, yesterday (Tuesday), where I explained this. What we have simply done is re-organisation. We have five business entities focused on business: Upstream, Downstream, Refineries, Gas and Power that are there before.
“There are also ventures that capture all our little companies that were not having proper stewardship. They are run by individuals who report to the GMD.
“The NNPC is still a whole. There is nothing new that has happened. I have tried to explain this and I am sure the NNPC workers are members of the family, they will understand.
‘’We are going to have a meeting, and they will be made to understand. Perhaps the engagement has not been good enough.
“NNPC has not been unbundled in the sense of breaking up NNPC into distinct institutions. I am concerned. I don’t want the industry shut down. I am sure we are going to resolve the issues very soon.”
-Vanguard