In Defense of Mele Kyari, NNPCL

Isuma Mark

Misconceptions and false narratives about public officers are a pervasive issue with far-reaching consequences. These distorted perceptions can erode public trust, hinder effective governance, and even destabilise societies. It is imperative to understand the dangers posed by such misinformation and to work towards fostering a climate of informed and critical engagement with public officials.

Indeed, when citizens harbor negative and unfounded beliefs about targeted public officers, it undermines the fundamental principles of democratic governance. Misinformation can be exploited by vested interests to derail important initiatives for the public good.

Equally, false narratives fuel hatred, prejudice, and violence, as people are more likely to demonise those they have been fed negative perceptions about.

These, clearly , are the challenges the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPCL), Mele Kyari faces presently, especially in the past couple of days when youths took to the streets protesting for good governance as well as in the course of the issues with the Dangote Refinery.

I have watched and read all manner of commentaries from purported analysts and experts who have taken every opportunity to lampoon Kyari, with some attempting to heap the blame for all the problems of Nigeria at the doorsteps of the NNPCL.

The Nigerian oil and gas industry has recorded several decades of monumental rot, even prior to the emergence of Kyari as the NNPCL boss, that analysts even came to the conclusion that the sector was the main channel through which the economic saboteurs of the country were milking the nation dry. Unfortunately, the Kyari-led management of the NNPCL that has been working extremely hard to change the narrative has been tarred with the same brush. Most problems in the petroleum industry have nothing to do with the NNPCL.

Kyari is a daring man, one who is not afraid to speak truth to power on critical issues in the sector. In line with the organisation’s responsibility of guaranteeing energy security, the NNPCL has been focused on delivering value to its stakeholders and Nigerians in general.

Firstly, one issue that has been widely trumpeted is the fact that Kyari had promised to ensure that the country’s refineries become operational, which is yet to materialise. While there is no doubt that the NNPCL recently announced that the Port Harcourt Refinery would become operational this year, we must understand that there is no crime in shifting timelines in project deliveries. For example, those in construction understand that in most cases, factors beyond the control of the executor of a project, such as economic, finance, climate, among others, may contribute to change in the project delivery timeline.

In the case of the ongoing rehabilitation of the refineries, the Kyari-led NNPCL adopted a different concept in the process. It is financed by banks. That is the difference between what the national oil company had in the past, where they would do the work halfway and never complete the process. But here, the banks would always put conditions for lending not just about payment but the ability to pay from your cash flow. Part of the requirements is also to include O and M component, which means that maintenance contracts would be part of the deal. Otherwise, they would not lend to the national oil company. It means when the repairs of the refineries are completed, there will be sustained operations.

This is what obtains anywhere in the world and the expectation is that at the end of the exercise, the refineries would come to their full capacity, at the very least 90 per cent of their installed capacity.

 Secondly, another issue that has seen some persons attack Kyari is the issue that Dangote Refinery had with the regulators of the oil and gas sector – the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA). For me, this clearly stems from the point of misunderstanding of the workings of the country’s oil and gas sector. A lot of commentators do not know that the NNPCL is not a regulator but subjects itself completely to the supervision and dictates of the NUPRC and the NMDPRA. There is no way Mele Kyari as an individual would be the person obstructing the take-off of the Dangote Refinery as had been erroneously sold to Nigerians through the media.

The enactment of the Petroleum Industry Act (PIA) 2021 was to restructure operations in the oil and gas sector, and it introduced sanity and entrenched a regime of transparency. With the PIA, the NNPCL has moved to assume its statutory role as a commercial operator in the entire value chain of the energy industry, and so it can not in any way impede Dangote Refinery. If both oil companies are to engage in any deal, especially in the area of crude oil supply, it has to be at mutually agreed terms devoid of emotions.

Operators of the Dangote Refinery must understand that nobody builds a refinery of such magnitude without finalizing agreement to get feed stock. The operators of Dangote Refinery must also understand that International Oil Companies have Production Sharing Contract (PSC) with the Nigerian government, which it can not destroy because of Dangote Refinery

Furthermore, under Kyari, the NNPCL’s profitability margins have significantly risen, growing from a loss position of N803 billion in 2018 to a profit position of N2.52 trillion in 2022. Currently, the NNPCL is involved in the entire value chain of the oil and gas business and controls over 30 percent of the nation’s petroleum retail market.

With crude oil theft and pipeline vandalism being major challenges to the company’s business, the Kyari-led NNPCL recently collaborated with the nation’s security services as well as third-party security contractors which has been yielding results, mostly in the area of increased crude oil production.

With oil theft and pipeline vandalism overwhelming Nigeria’s oil business in recent past, the NNPC Limited had adopted the Saudi Aramco’s model of using video surveillance to monitor its pipelines carrying crude oil from wells to flow stations in the Niger Delta.

The NNPCL, in collaboration with security agencies, had also put up a control center to provide surveillance of all the country’s oil and gas assets in the Niger Delta.  The surveillance system is known as the Central Coordination, Data Integration, and Activation Control Room. Just like the Saudi Aramco, the NNPC Data Control Center uses video visibility to monitor the country’s Niger Delta pipeline networks, where more than 90 percent of the country’s crude is explored Through the Data Control Center, the NNPC has the capability to see and monitor the movement of vessels in the coast of Nigeria’s territorial waters in real time.

Beyond arresting crude oil thieves and shutting down illegal refineries, the NNPCL under the leadership of Kyari is expanding the frontiers for crude oil production as the NNPCL has invested in several gas and power projects across the country, aimed at supporting the federal government’s power generation and industrialisation aspirations.

To demonstrate this commitment to transforming Nigeria’s power sector, the NNPC under Kyari had entered into a turnkey Engineering, Procurement and Construction (EPC) contract with China Machinery Engineering Corporation (CMEC) to construct the Gwagwalada Independent Power Plant (GIPP) project. The project, which was flagged off by President Bola Tinubu, has been described as a game-changer in Nigeria’s power sector. It is a 1,350MW Combined Cycle Power Plant with auxiliaries and Balance of Plant located on 547 hectares of land already acquired at Gwagwalada, in the Federal Capital Territory (FCT), Abuja. The project is expected to generate between $700 million and $800 million annually within the first ten years of operations. The GIPP was necessitated by the need for delivering gas towards additional power generation capacity in Nigeria. Under the plan, gas supply to the plant will be through the Ajaokuta- Kaduna-Kano (AKK) Gas Pipeline Project, which is currently at its advanced stages of construction.

The GIPP project consists of three power train blocks of 450MW each. Each block will include two General Electric (GE) gas turbine generators, two heat recovery steam generators (HRSG), one steam turbine electric generator, one direct air-cooling condenser, balance of plant equipment and a black start diesel generator.

Furthermore, the national oil company is working assiduously to revamp local refining of petroleum products and collaborating with indigenous refiners to ensure Nigeria becomes a net exporter of petroleum products.

That was why Kyari, during an interactive session organised by the Senate Adhoc Committee probing sabotage in the oil and gas sector, chaired by the Senate Leader, Opeyemi Bamidele, during the week, stressed that the NNPCL, “is loyal and faithful to the country,” pledging the commitment of the national oil company’s management to protect the interest of Nigeria in the petroleum industry.

“We are faithful and loyal to the economic interest of this country. We are not criminals. We are not thieves. But we will protect our dignity and honor,” he added.

He said, “The NNPC is a company owned by over 200 million Nigerians. And I happen to be the chief executive of this company. The law is clear around what the chief executive of this company will do.

“Our memorandum article of association, the Petroleum Industry Act, and all other enabling, including the Company and Allied Matters Act, (CAMA), which was legislated by this Honourable National Assembly had listed our roles.

“All of us here see what is happening in the media. Targeted personal attack on my person on the institution, and we all know how this works. They are deliberate. They are calculated.

“It creates the impression that NNPC Limited and our leadership are doing everything to create economic sabotage in our country. It is far from it.

“I assure you, Mr. Chairman, that the NNPC Limited and its board of directors and its shareholders are faithful and loyal to this country.

“We do not lie to this country. And we do nothing to sabotage the economic interests of this country. As a matter of fact, NNPC is the economic interest of this country.”

From the foregoing, it is important to note that the cornerstone of good governance rests on the principle of fairness, transparency, and accountability. A critical component of this triad is the equitable treatment of public officers. This necessitates granting them a fair hearing and subjecting their performance to objective assessments and not personality attacks. That is why Nigerians must be wary of merchants of falsehood who are bent on destroying the image of the NNPCL, and their only agenda is to see Kyari out of the company.

Isuma writes from Abuja