NNPC Weekly: No complacency as we transform to limited coy — Kyari

NNPC GMD, Malam Mele Kyari


The Nigerian National Petroleum Company Limited (NNPC Ltd.) started the new week with an assurance to its investors and stakeholders that the days of complacency were over.

The assurance came following the repositioning of the company to focus on profitability and value addition to its shareholders.

The GMD/CEO of the NNPC, Malam Mele Kyari, gave the assurance at the opening ceremony of the 2022 edition of the Nigerian Oil and Gas (NOG) Conference and Exhibition which held at the International Conference Centre, Abuja.

Declaring the conference open, Kyari who was represented by NNPC Chief Financial Officer, Mr Umar Ajiya, called on operators in the nation’s oil and gas industry to focus more on gas development.

Kyari said emphasis should be on gas-to-power, gas-to-industry and gas-for-export projects and activities.

He explained that with the reality of the global energy transition and Nigeria’s commitment to use gas as its transition fuel, value now lies in gas development.

The NNPC GMD/CEO also said that the Petroleum Industry Act (PIA) had also provided ample incentives for investors in the gas sector.

Kyari urged delegates and exhibitors to use the opportunity provided by the conference to network and brainstorm on solutions to the challenges brought about by the global energy transition and the Russian-Ukraine war.

He also urged them to find better ways to maximise the potentials inherent in the nation’s abundant gas resources.

Meanwhile, the NNPC Ltd. within the week called on its partners and operators in the oil and gas industry to beef up investment in order to close the yawning energy supply gap in the country.

The GMD/CEO of NNPC Ltd., Malam Mele Kyari, made the call at the NNPC Spotlight Session of the just concluded 21st Nigerian Oil and Gas Conference and Exhibition which held at the International Conference Centre, Abuja.

Speaking at the conference with theme, “Funding the Nigerian Energy Mix for Sustainable Economic Growth”, Kyari said there was a huge gap in the Nigerian energy market with 80 per cent of citizens lacking access to clean cooking gas and 48 per cent lacking access to electricity.

“That gap is huge and we cannot fill it with the scale of investment we are doing in the renewable.

“This is critical for us and we will continue to emphasise that our key role is to be able to bring gas and make it available to everyone.

“The fact that energy transition is unfolding to everyone means we must invest in it and we are seeing a great resistance across the globe on funding fossil fuel until the Ukrainian challenge came up.”

According to Kyari, NNPC is currently engaging with partners and multilateral institutions that are involved in energy transition to find ways of resetting financing strategies in a manner that will enable energy companies and institutions to collaborate for investment in order to eradicate energy poverty.

On the new role of NNPC as a limited liability company, Kyari said that NNPC had been positioned as the company with the largest capital base in Africa to serve as a reliable partner to all willing investors.

“In this regard, NNPC Ltd. offers a lineup of investment opportunities that guarantee positive returns across the energy value chain.

“On July 19, 2022, Mr President will unveil the new NNPC Ltd. to the world. I am inviting you to that epoch-making event in the history of our company,” he said.

Also speaking at the conference, Chairman of Board of Directors, NNPC Ltd., Sen. Margery Chuba-Okadigbo said that the mandate of the new NNPC was clearly spelt out in the Petroleum Industry Act (PIA) 2021.

According to her, the PIA is a testament to the Federal Government’s commitment to put in place the right environment for the advancement and development of oil and gas industry.

“NNPC limited is a commercially oriented and profit driven company which creates opportunities for improved indigenous participation.

“The new entity presents opportunities for enhanced revenue and returns on investment.”

She stated that the effective implementation of the PIA would stimulate sustainable social impact through the creation of quality jobs for the teeming youth and consequently change the social perception of the industry.

In the meantime, the Group General Manager of the National Petroleum Investment Management Services (NAPIMS), Mr Bala Wunti, disclosed that Nigeria needed about 800 billion dollar-worth of investments to meet the crude oil production target of four million barrels per day.

Wunti made the disclosure in Abuja during a panel session at the just concluded 21st Nigerian Oil and Gas Conference and Exhibition with the theme, “Funding the Nigerian Energy Mix for Sustainable Economic Growth”.

He said the money must be channeled into exploration and production, midstream conversion capability and requisite downstream infrastructure.

Speaking on the theme, “Energy Transition: Making Nigeria the Preferred Africa Energy Investment Hub”, the NAPIMS boss said Nigeria had abundant crude oil and natural gas resources which can only translate to value for the country if properly harnessed and produced for the benefit of the people.

He said that the time had come for the country to look inwards and develop its huge oil and gas potentials by restructuring the industry to attract the much-needed investments across the oil and gas value chain that would create wealth and prosperity for the people.

He called for stronger partnership and collaboration among stakeholders in the oil and gas sector, particularly in the area of finance, project execution, and technology development.

Giving a breakdown of the investments required, Wunti said that the country needed about 400 billion dollars in the upstream and midstream segments of the value chain, while another 250 billion dollars investment would be required in the downstream sector across the country in order to ensure energy sufficiency.

International oil companies (IOCs) operating in Nigeria including Shell, Chevron, TotalEnergies, and ExxonMobil in the week under review expressed their frustration over the escalating oil losses in the Niger Delta due to the activities of oil thieves.

Speaking at the industry leaders’ panel session at the 2022 edition of the Nigerian Oil and Gas Conference and Exhibition, the CEOs said the unrelenting menace of crude oil theft had led to a decline of the nation’s daily oil production from 1.8million barrels per day in the last three years to just a little over one million barrel per day.

Firing the first salvo on the topic: “The Future of Nigeria’s Energy Sector in the PIA Era”, the Chairman of Shell Companies in Nigeria and Managing Director of Shell Petroleum Development Company, Mr Osagie Okunbor, warned that the new marginal field licensees that would operate Oil Mining Leases (OMLs) 53 and 57 may experience difficulties evacuating their crude oil.

Okunbor said that two of the most important oil pipelines in the country were currently shut down with hundreds of thousands of barrels a day shut-in.

“In three to five years, we were brought down from 1.8 million barrels. So it is an existential issue for us.

“We need to address it; if we do not address it, we cannot do all the new oil development issues, and that will continue to occur.

“But what is really going to move the needle for us in terms of bridging this gap of hundreds of thousands of barrels a day is solving the evacuation problem.”

He tasked stakeholders and participants at the conference to put heads together to seek ways to deal with the challenge.

Managing Director of Chevron Nigeria Limited and Chairman of the Oil Producers Trade Section (OPTS), Mr Rick Kennedy, said while the industry stakeholders collaborate to fine-tune the Petroleum Industry Act (PIA) in a manner that offers encouragement to all players, it was also imperative for the oil theft challenge to be addressed by all parties.

On his part, the Executive Director at ExxonMobil Nigeria, Mr Oladotun Isiaka, who represented the Managing Director, Mr Richard Laing, also said stakeholders should work together to tackle the oil theft challenge as it was impacting negatively on investments in the upstream sector.

The Managing Director of TotalEnergies E&P Nigeria Limited, Mr Mike Sangster, called for further dialogue between the industry stakeholders and the authorities on the PIA.

The TotalEnergies boss called for the constitution of another working group made up of persons from the authorities and the industry in order to find ways to address some of the issues.

Crude Oil theft in Nigeria
Crude Oil theft in Nigeria

Still in the week under review, the federal government made a payment of 100 million dollars as part of Nigeria’s counterpart fund in the Presidential Power Initiative (PPI) undertaken by German power firm, Siemens.

The development was aimed at solving the electricity challenge usually caused by the collapse of grid in the country.

Chairman, Senate Committee on Power, Sen. Gabriel Suswan disclosed this at the NOG conference during his presentation on the topic:” Developing the Power Sector Policy for an Emerging Economy”.

He said the Minister of Power, Mr Abubakar Aliyu, revealed that to the Senate committee during a meeting recently.

Sen. Suswan added that with this development, power supply would increase to about 7000 megawatts.

“The government has paid 100 million dollars for the project so that someone can quickly activate that contract, so that the power deficit which has militated against proper servicing of the industry will come to an end.”

Amidst the current global posture on energy shift to renewables to reduce carbon footprint, the NNPC Ltd. said that there was need for Nigeria to adopt homegrown solutions to the nation’s energy poverty challenge.

The GMD/CEO of NNPC Ltd., Malam Mele Kyari, stated this in an address at a plenary session on “Oil and Gas Industry in Nigeria and the Quest for Energy Transition” at the 2022 National Energy Summit held in Abuja.

Kyari was represented at the event organised by the Energy Commission of Nigeria in collaboration with the International Energy Charter (IEC), Brussels, Belgium and the Economic Community of West African States (ECOWAS) by the NNPC Group General Manager, Corporate Planning and Strategy, Mrs Oritsemeyiwa Eyesan.

He contended that given present realities in the global energy community, it had become imperative for the country to focus more on in-country initiatives to harness its abundant natural resources to bridge existing energy gap.

“NNPC is working on floating various LNG projects that will harness the nation’s natural resources to grow the domestic gas market in line with Federal Government’s aspiration to meet energy needs of Nigerians.

“Prior to the technical transition to a limited liability company on July 1, 2022, NNPC has proactively set up a world class Research, Technology and Innovation (RTI) Division as part of the efforts to become a global energy company of choice.

“This is because we recognise that innovation remains a core tool in actualising energy transition aspiration.”

Also speaking at the event, the General Manager, Gas and Renewable Energy of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Dr Ola Agbaje, pointed out that virtual gas transportation was gaining traction in Nigeria.

He described the NNPC’s ongoing 614km Ajaokuta-Kaduna-Kano (AKK) gas pipeline as a “Transformational Project”.

Earlier in her presentation on “2020/2021 Energy Investment Risk Assessment Reports” the Official of the International Energy Charter (IEC), Ishita Pant, applauded the numerous gas expansion programmes and reforms in the nation’s oil and gas sector, especially, the PIA.

The session was moderated by a former Group Executive Director of the NNPC and Partner, Gulf of Guinea Petroleum Consulting, Mr Onochie Anyaoku.

AKK Gas Pipeline Project
AKK Gas Pipeline Project

In another development, an oil and gas sector pressure group, Women in PENGASSAN called for stiffer punishment for domestic and gender-based violence offenders to serve as deterrence.

The call became important following the increasing wave of domestic and gender-based violence across the country.

The group made the call at the grand finale of its nationwide advocacy programme tagged: “PENGASSAN Women Say No to Domestic/Gender-Based Violence” which held in Abuja.

Speaking during an awareness march from the Unity Fountain to the Ministry of Women Affairs in Abuja, the Chairperson of the group, Faith Usoro, said tougher punishment for perpetrators of domestic and gender-based violence was the only way to stem the tide of the crime as desperate situations required desperate remedies.

Receiving the group on behalf of the Minister of Women Affairs, Mrs Pauline Tallen, the Director, Economic Services, of the Ministry, Mr Idris Mohammed, said the Ministry was working with stakeholders to enact more laws to protect the rights of women.

Tallen said that even the Bills that were earlier thrown out by the legislature would be revisited.

The Minister listed some of the measures put in place by the ministry to curb domestic and gender-based violence to include, “one, launch of sexual offenders’ register aimed at naming and shaming.

“We have a contact line +234-8031230651 and +234-7053576528 for receiving complains.”

On a final note, the international oil community lost Mohammad Barkindo, the Secretary General of the Organisation of Petroleum Exporting Countries (OPEC).

Barkindo whose tenure commenced in 2016 and was to end this month, was born on April 20, 1959 in Yola, Adamawa State.

He held a B.Sc. (Hons) in Political Science, Ahmadu Bello University, Zaria, Kaduna State and Post Graduate Diploma in Petroleum Economics, in Oxford, United Kingdom.

He also held an MBA in Finance and Banking, Washington University, in the United States.

Barkindo who was a Fellow, George Mason University, Fairfax VA, U.S., also held a Doctorate Degree in Science (Honoris Causa) of the Federal University of Technology, Yola.

He began his working career as a Special Assistant to the Minister of Petroleum Resources and Head, Office of the Chairman of the Board of the Nigerian National Petroleum Corporation, NNPC Board between 1986 and 1989.

He also served in various capacities in the NNPC Group, spanning some 24 years, namely:

Head, International Investments, Investment Division, NNPC Headquarters (1992)

–        Head, International Trade, NNPC London

–        President, Duke Oil Inc.

–        Chairman NAPOIL (1993–94)

–        General Manager, NNPC London Office (1993–97)

–        Managing Director/Chief Executive, HYSON/CALSON, an international trading arm of the NNPC (1998–2003)

–        Group General Manager Investments, NNPC Headquarters (2003–04)

–        Deputy Managing Director/Chief Executive, NLNG (2005).

Between 2007 and 2009, he served as Coordinator, Special Projects, NNPC, with the mandate to oversee all Federal Government projects vested in the NNPC.

Barkindo participated as a member of the Oil and Gas Industry Reform Implementation Committee (OGIC) that produced the original draft of the Petroleum Industrial Bill (2008) and led the Transformation Programme of the NNPC as enshrined in the Oil and Gas Industry Reform Implementation Committee Report (2008).

Between January 2009 and April 2010, Barkindo served as Group Managing Director of the NNPC.

Before becoming the Secretary General of OPEC, he served at various capacities in the organisation between 1986 and 2010.

He was a Nigerian Delegate to OPEC Ministerial Conferences between 1993 and 2008 and served as Nigeria’s National Representative on OPEC’s Economic Commission Board (ECB).

Between January and December 2006, he served as Acting OPEC Secretary General, before chairing the ECB from 2009 to 2010.

He became Nigeria’s Governor for OPEC and served as Adhoc OPEC Governor at various times, as well as Chairman OPEC Task Force of the 15th Session of the United Nations Commission on Sustainable Development (UNCSD).

Also on the international energy scene, he spearheaded the OPEC/European Union dialogue on Energy Markets, Taxation and Environment.

He was a key player in the first Long Term Strategy (LTS) at OPEC, and a delegate to the African Petroleum Producers Association (APPA) conference in Algiers, Algeria, in 1986.

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He was also a delegate to the African Petroleum Producers Association (APPA) Ministerial Conferences from 1987 to 2010.

The late Barkindo was a pioneer member of the International Energy Forum (IEF), Riyadh, Saudi Arabia.

He helped to facilitate and consolidate the OPEC/non-OPEC cooperation and dialogue on climate change and led Nigeria’s technical delegations to the climate change negotiations that produced the United Nations Framework Convention on Climate Change (UNFCCC) and the Kyoto Protocol to the UNFCCC.

It is worthy to note that he was the only Nigerian Delegate to attend all 15 Conferences of the Parties to the UNFCCC from Conference of the Parties, COP1 in Berlin 1995 to COP15 in Copenhagen 2010.

In 2002, he served as Coordinator, Group of 77 and China at UNFCCC, and was elected Vice-President of the Conference of Parties at COP13 of the UNFCCC in Bali, Indonesia, in December 2007.

He was re-elected Vice-President variously at COP14 in Poznan, Poland, in December 2008 and at COP15 in Copenhagen, Denmark, in December 2009.

Barkindo participated at the UNFCCC COP22 (Marrakesh 2016), COP23 (Bonn 2017) and COP24 (Katowice 2018).

His hobbies included reading, charity work, the environment and soccer.

The Nigerian oil and gas industry, and indeed the entire global energy community missed his invaluable contributions to the growth of the industry.