* Reps kick against desecration of Constitution, move to stop unconstitutional implementation
Dr. Ibe Kachikwu, Minister of State for Petroleum and Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), has unbundled the organisation into five Businesses and two Services components.
He has since elevated the NNPC Group Executive Directors (GEDs) to Chief Executive Officers (CEOs) and redeployed them to head the various business components.
The GMD told journalists in Abuja Tuesday that the movements were part of his strategy to ensure that each of the former GEDs pushed what used to be the former divisions in the NNPC Group to profitability
Contrarily, however, the House of Representatives has moved to stop Kachikwu from going ahead with his unbundling of the corporation without amending the extant establishment law, the NNPC Act, 2004.
House Speaker Yakubu Dogara, presiding over Tuesday’s session, described as a desecration of the Constitution if the minister did not allow the National Assembly (NASS) to legislate the unbundling of NNPC before he proceeds.
It is unclear whether NNPC and the government would ask a competent court to allow the illegal implementation to proceed while the legislative process is remedied simultaneously or the legislature would pre-empt them to court and freeze the entire unbundling process pending passage and presidential assent of the amendment of the enabling law.
Meanwhile, the new CEOs are: Alhaji Bello Rabiu, formerly Group General Manager, Corporate Planing $ Strategy (CP&S), is now CEO, Upstream; Mr. Henry Ikem-Obih is CEO, Downstream; Anibor Kragha is CEO, Refineries; Alhaji Saidu Mohammed, former MD of Kaduna Refinery is CEO, Gas & Power; Mr. Babatunde Adenira is CEO, Ventures; Isiaka Abdulrazak is CEO, Finance and Services; while Isa Inuwa who was DMD, NLNG is now Executive Head of Corporate Services.
According to Kachikwu, the new arrangement will eliminate bureaucracy in the operations of the corporation and that each of the constituent units would be profit-driven. Asked if the steps he was taking would not conflict with the provisions of the Petroleum Industry Bill (PIB), the GMD said he was speaking with lawmakers of the National Assembly (NASS) and that the restructuring agreed with the PIB, in principle.
“What we are doing is in anticipation of the PIB. We are tailoring it towards the PIB because we are in conversation with the legislators,” he said.
No job losses
Kachikwu allayed fears of job losses among staff of the corporation and all its subsidiaries, saying his mandate did not include sacking workers.
His words: “There are lots of worries that there would be a lot of job losses in the system; one can understand that given what is happening in the global oil industry. Any attempt to transform, people would think there would be job loss.
“We are quite truly overstaffed but the principle of the restructuring is that nobody loses his or her job but everybody will get busy.
“I do not have the mandate of the President to create a job loss situation. His mandate is to try and ensure, unless for reasons of bad staff performance, fraud, which obviously requires investigation, there is no mass attempt to let people go and the present structure has a zero sum game in terms of job loss for now.
“When the entities begin to run their business, the managing directors would look at it and see how they create enough utilization for everybody who is in there. If there is the need to change that model, they would come back. That would be the call of an MD of a subsidiary company to make, not the call of the GMD.”
Fuel importation ends in 12 -18 months
The GMD said that his team planned to stop the importation of refined products in the next 12 to 18 months. The strategy towards achieving this objective has been clearly laid out and that it included partnership with Joint Venture partners and other investors who have been invited to co-locate new refineries within the premises of existing ones.
Kachikwu said the process of fixing the refineries has started and that NNPC was looking at entering into a series of partnerships with investors and oil majors on the upgrade of the refineries and in co-location of refineries along with existing ones.
However, he said to fix the four refineries, the country would require about $400 million, adding that the Federal Government was considering sourcing the amount from investors.
According to him, the total revamp of the refineries is being hindered by lack of funds and investment, especially as most of the refineries are old and needed massive overhaul and refurbishment.
He said talks were already ongoing with the original builders of the refineries and some oil majors who have shown interest in investing in the upgrade of the refineries, adding that when the refineries were finally fixed, they would contribute to building the country’s strategic fuel reserves.
Furthermore, he explained that addressing the issues of JV cash call arrears and ensuring adequate security of the pipelines and other critical petroleum infrastructure was part of its grand plan to boost Nigeria’s crude oil output to 2.4 million barrels per day before the end of this year.
On fixing pipeline on the damaged Excravos facility, he said: “We have been able, after six years, to get back the Brass-Port Harcourt pipeline and we have started pumping to the Port Harcourt refinery and it resumed production just a few days ago.
“We are putting in a lot of effort to see how we can get back the pipeline from Escravos to Warri. In the interim, we have resorted to trying to move on a temporary basis, crude cargo into Warri, using vessels. But short of leaving Kaduna and Warri idle, while still trying to restore the pipeline, we had to negotiate hard and take an emergency position to send crude. So, crude is being pumped to Warri as we talk, but by vessels, which is not the most ideal.
“The hope is that before the end of the month, the three refineries would have received crude and hopefully begin to work and that would soften the situation.”
We have not removed subsidy
Dr. Kachikwu clarified that the Federal Government had not removed subsidy. He however, said that at the current crude oil prices at the international market, there was “subsidy gain” for the government.
He said it would enable his team to build up reserves for a period in the future when crude oil prices would rise as being anticipated.
His words, “We have not removed subsidy. What we have done is to ensure that we don’t pay subsidy. We have moved from subsidy obligation to subsidy gain.”
Reps kick against illegal implementation of unbundling
On the contrary, the House of Representatives has stopped Dr Kachikwu from going ahead with his planned unbundling of the corporation without amending its extant establishment law, the NNPC Act, 2004.
House Speaker Yakubu Dogara, presiding over Tuesday session, described as a desecration of the Constitution, any attempt to unbundle NNPC without amending the enabling law.
Consequently, the lawmakers asked President Muhamnadu Buhari to send an Executive Bill to NASS as constitutional due process demands to be able to unbundle NNPC into the 30 companies planned by the ministry.
A motion by Jarigbe Agom Jarigbe (PDP, Ogoja/Yala Federal Constituency of Cross River State), argued that changing NNPC could only proceed with the amendment of its Act by the NASS.
In concurrence, the House mandated its committees on Petroleum Upstream, Downstream, Gas and Local Content as well as Legislative Compliance to ensure that the Minister of State for Petroleum was stopped from usurping NASS powers.
-Vanguard
