By Adewole Kehinde
I was on Twitter this evening when my attention caught #NNPCAudit trending in Nigeria.
Even though the Hash Tag did not take up to an hour when it disappeared and stopped trending in Nigeria.
I will like to set the record straight as a journalist who has been covering the activities of the Nigerian National Petroleum Corporation.
Oil is the major mineral resource for Nigeria and it remains the major economic driver and mainstay of the country.
The unsustainable management of Nigeria’s oil wealth, rather than the availability of oil itself, remains the real cause of the challenges of the Corporation until Mal Mele Kolo Kyari came on board.
The Nigerian National Petroleum Corporation (NNPC) under the Management Mallam Mele Kolo Kyari made history on Friday, June 12, 2020 with the publication of its first audited financial statements after 44 years of its operation.
The annual reports and financial statements for the year ended December 31, 2018, were for 20 of the state-owned national oil company’s subsidiary companies operating within and outside the country
The companies covered in the reports published in corporation’s website on Friday, June 12, 2020 included the Nigerian Petroleum Development Company (NPDC), Warri Refining & Petrochemical Company Limited (WRPC), Port Harcourt Refining Company Limited (PHRC), Kaduna Refining & Petrochemical Company (KRPC), and Integrated Data Services Limited (IDSL), Nigerian Products and Marketing Company Limited (NPMC), Nigerian Pipelines and Storage Company (NPSC).
The others include the National Engineering & Technical Company Limited (NETCO), Nigerian Gas and Marketing Company Limited (NGMC), Duke Oil Services (UK) Limited, Duke Global Energy Investment Limited, Duke Oil Incorporated, NNPC Retail Limited, National Petroleum Investments Management Services (NAPIMS), The Wheel Insurance, NIDAS Shipping Services, NIDAS UK Agency, and NIDAS Marine.
Barely five months after publishing its 2018 Audited Financial Statement, the Nigerian National Petroleum Corporation (NNPC) also released its 2019 Audited Financial Statement with a 99.7% reduction in its loss profile from ₦803bn in 2018 to ₦1.7bn in 2019.
According to a statement by the Corporation’s spokesman, Dr. Kennie Obateru, he quoted the NNPC Chief Financial Officer (CFO), Mr. Umar Ajiya, as saying that the 2019 Audited Financial Statement, which was concluded five months after the release of the 2018 Audited Financial Statement, will be published on the Corporation’s website for all to see in keeping with Management’s commitment to transparency and accountability and in consonance with the principles of the Extractive Industries Transparency Initiative (EITI) of which it is a partner.
Giving further insight into the 2019 AFS, the CFO disclosed that general administrative expenses also witnessed a 22% dip from ₦894bn in 2018 to ₦696bn in 2019.
According to Ajiya, majority of the subsidiaries posted improved performance namely, the Nigerian Petroleum Development Company Limited (NPDC) which recorded ₦479Billion profit in 2019 compared to ₦179Billion in 2018 representing 167% increase; the Integrated Data Services Limited (IDSL) recorded ₦23Billion profit in 2019 compared to ₦154Million in 2018 representing 14966% increase; the Petroleum Products Marketing Company (PPMC) recorded ₦14.2Billion profit in 2019 compared to ₦9.3Billion in 2018 representing 52% increase; while the Refineries have maintained the same level of losses as in 2018 but which will reduce significantly in 2020 due to cost optimization drive.
The CFO explained that the improved performance in the 2019 financial year was driven mainly by cost optimization, contracts renegotiation and operational efficiency. He said “the 2019 Audited Financial Statement goes further to demonstrate NNPC’s unwavering commitment to the principle of Transparency, Accountability and Performance Excellence (TAPE) while the outlook for 2020 looks promising in view of the Management’s strong drive to prune down running cost and grow revenues.”
It would be recalled that the Group Managing Director of NNPC, Mallam Mele Kyari, had promised to sustain the publication of the Corporation’s Audited Financial Statement as part of efforts to deepen transparency and accountability and keep stakeholders abreast of NNPC operations.
The Transparency, Accountability and Performance Excellence (TAPE) initiative of the Group Managing Director of the NNPC earned Mallam Mele Kolo Kyari commendation from the former Executive Secretary, Nigeria Extractive Industries Transparency Initiative (NEITI), Waziri Adio, for keeping his promise to publish the audited reports.
Waziri Adio through a tweet with his personal twitter handle, @Waziriadio said, “Having such disclosures is good for transparency and accountability. I congratulate Mele Kyari and his team and urge them to make this a regular practice and in open data format.”
We may recall that Nigeria Extractive Industries Transparency Initiative has been in the vanguard of the sustained demand for the NNPC to make public the financial statement of its operations and those of its subsidiaries.
On assumption of office, Mallam Mele Kyari pledged to open the NNPC financial books to the public as part of his management’s commitment to openness, transparency, and accountability in line with the global EITI principles.
Since 2019, the NNPC has always published the monthly financial and operational reports, including its upstream, downstream and oil and gas export activities.
The NNPC’s Financial and Operations reports constitute the following and more: NNPC Audited Financial Statements; NNPC Monthly FAAC Reports; National Crude Oil & Natural Gas Production, Lifting and Utilization; Refinery Operations; Petroleum Product Supply & Distribution; Budget Performance Report and Federation Crude Oil & Gas Revenue.
Mele Kyari is determined to change the narrative; to re-write the story; to make a new garment for the corporation. He came to the job armed with a Presidential briefing: Clean up the mess, make the books open; engender transparency.
The 2018 audited account shows a loss of N803billion. This got the management adopting smarter strategies to run lean and mean; to cut cost and turn the corner. It worked. By the time it released the 2019 audited financial statement, it had achieved 99.7% reduction in its loss status, cutting loss from N803bn in 2018 to N1.7bn in 2019.
This would never have been possible if Mallam Mele Kyari had not summoned the courage to go public with the 2018 financial statement.
The huge loss in 2018 made them to stop leakages, improve on forethought and introduce cost-saving measures.
It is on record that Nigerian National Petroleum Corporation under the management of Mal Mele Kolo Kyari has the highest number of award received for transparency and accountability.
For those who are trending #NNPCAudit, please do me a favour of clicking the link to view the 2019 Audited Financial Statements https://nnpcgroup.com/Pages/afs.aspx
Kyari’s insistence to depart from the path of past GMD’s of the Corporation who kept the books sealed has already set him apart from the crowd.
And it sure would take him to places none of his predecessors has ever seen or been before.
Kyari’s insistence to open the books to Nigerians is itself a constitutional fulfillment.
It takes courage to do this. I commend him and his entire Management Team.
Adewole Kehinde is the Publisher of Swift Reporters and can be reached via 08166240846, 08123608662