The NNPC GMDs Forum, a body comprising present and former group managing directors of the Nigerian National Petroleum Corporation, Nigeria’s state-owned oil company has expressed reservation over the sealing placed on the price at which the Pipelines and Products Marketing Company, a subsidiary of NNPC, sells premium motor spirit to marketers.
Rising from its one-day meeting held on Saturday, September 3, 2016, at the Transcorp Hilton, Abuja, during which it reviewed the status of the corporation and the nation’s Oil & Gas Industry, the forum observed that the current sealing on price of PMS was not in conformity with the liberalization policy of the government and current realities in the foreign exchange market, the Daily Sun reports.
In a statement issued by the group general manager, Public Affairs, NNPC, Garba Deen Muhammad on its deliberations and resolutions, the forum commended NNPC “for resolving the fuel supply crisis and urged the corporation to emplace measures that will ensure sustenance of seamless supply of petroleum products nationwide.”
The forum however noted, “that the PMS price cap of N145/litre is not congruent with the liberalization policy especially with the foreign exchange rate and other price determining components such as crude cost, Nigerian Ports Authority (NPA) charges etc remaining uncapped.”
The forum advised that the existing refineries be rejuvenated using the Original Equipment Manufacturers, OEMs, and also said that the refineries must be restructured to operate as an incorporated joint ventures, IJV, similar to the Nigerian Liquefied Natural Gas, NLNG, model with the participation of credible partners who have requisite technical and financial capabilities.
Furthermore, the forum expressed concern over the increasing negative perception of the corporation by Nigerians especially in terms of opaqueness and accountability and therefore urged the NNPC management to assiduously “educate Nigerians on NNPC activities as a commercial entity managing the nation’s assets in trust.”
It advised that funding of JV Operations should be the first line charge to oil revenue to ensure sustainable production and reserve growth.
On the knotty issue of the status of the National Petroleum Investment & Management Services, NAPIMS, the forum noted that for effective functioning of any National Oil company, NOC, the technical components of the country’s Exploration & Production E&P, must be integrated as part of the country’s NOC.
Therefore, the forum “posited that NAPIMS being the technical component of Nigeria’s E&P, and not just an investment vehicle, must remain with and be managed by NNPC.”
In line with this conviction, the forum faulted the current Petroleum Industry Bill, PIB, which proposed the incorporation of NAPIMS, stressing that taking it out of the NNPC would inhibit the effective functioning of the NNPC as a National Oil Company, NOC, as it would make NNPC to operate at a different level compared to its peers in other OPEC member countries.
The forum explained that there was nothing essentially wrong with incorporation of NAPIMS as long as it remained a subsidiary of NNPC.
Earlier during the meeting, the incumbent GMD, Dr. Maikanti Kacalla Baru, had presented his 12 Business Focus Areas towards putting the corporation on the path of growth and profitability, before the forum went into the brainstorming session on the declining production level and its attendant consequences on the environment and the nation’s revenue.
The forum reviewed the security challenges threatening Oil & Gas production and damaging the Niger Delta environment and urged the government government to engage the various host communities as well as established social and traditional structures to develop an actionable partnership framework toward finding a lasting solution to the present unrest.
