When Mele Kyari mounted the saddle as the 19th Group Managing Director, GMD, Nigerian National Petroleum Corporation, NNPC, two years ago, the oil and gas industry was threatened by many challenges, including technical, operational, and transparency issues.
Consequently, in his inaugural address to the personnel of the Corporation, he had said: “Going forward, we will seek to continuously entrench transparency, accountability, and performance excellence across all NNPC operations, and we will put the necessary structures in place to ensure compliance with these principles.”
Kyari, who emerged with a roadmap, had also said: “it would guide NNPC aspirations to achieve sustained outstanding performance to meet the short and long-term growth objectives of the corporation, as we transit to a national energy champion.”
However, the latest scorecard obtained by Vanguard, showed that positive impacts have been made in many areas.
Oil exploration
Specifically, it showed that determined to increase the nation’s oil reserves to 40 billion barrels, the GMD galvanized NNPC to rev up exploration work in the inland basins, with the drilling of the Kolmani River II well, culminating in oil find in commercial quantity in the Upper Benue Trough.
The drilling of Kolmani River III well is ongoing with high prospect of the oil find. Seismic data collection is also ongoing in the Bida and Sokoto basins, while plans are underway to re-launch the exploration work in the Chad Basin.
In terms of oil production, he helped to resolve the dispute involving Shell and Belema Oil, which had scuttled the production of over 30,000 barrels per day, bpd, in Oil Mining Lease, OML 25.
He also led the corporation to execute the Abo OML 125 Heads of Terms, leading to the resolution of the issues around most of the deep offshore Production Sharing contracts, thus paving the way for the renewal of OML 125 and further investment in the exploration of the field to enhance the nation’s crude oil production.
Also, in May 2021, Kyari led the corporation to sign agreements with SNEPCo and other Production Sharing Contract, PSC, partners to resolve the disputes around OML 118, leading to the renewal of that acreage, with the prospect of a new $10 billion investment in the development of the Bonga South-East Field.
Furthermore, the Kyari-led management secured a number of alternative funding facilities for the Nigerian Petroleum Development Company, NPDC, and some Joint Ventures, JV, to facilitate further development of assets.
Gas development
In the area of gas, Kyari worked with other stakeholders to take the Final Investment Decision, FID, on the Nigerian Liquefied Natural gas, NLNG, Train 7 Project in December 2019, having been on the drawing board for over 10 years.
It played leading roles in the signing of the engineering, procurement and construction contract with the SCD JV Consortium comprising affiliates of Saipem, Chiyoda, and Daewoo.
This project is expected to generate over $20 billion of revenue to the Government over the project’s lifecycle, as well as create 10,000 direct and 40,000 indirect jobs.
Also, NNPC successfully flagged off the construction of the Ajaokuta-Kaduna-Kano, AKK, gas pipeline project, which is an integral part of the Trans-Nigeria Gas Pipeline, TNGP, with a capacity to transport about 2.2 billion cubic feet of gas per day on June 30, 2020.
Kyari’s administration also led the NNPC to achieve a $300 million reduction in the cost of the AKK Gas Pipeline contract via contract renegotiation from the initial $2.8 billion.
An additional major stride in the gas sector was witnessed in late 2020, with the commissioning of the Oredo Integrated Gas Handling Facility, IGHF, and the Liquefied Petroleum Gas Storage and Dispensing Unit, which facilities are wholly owned and constructed by the NPDC to address domestic gas supply challenges.
In order to provide an alternative to petrol, he led NNPC to key into the Year/Decade of Gas initiative, spearheaded by the Minister of State for Petroleum Resources, to launch the Autogas initiative.
Specifically, it executed a JV agreement with NIPCo to help in the marketing and distribution of the product to get as many Nigerians as possible to migrate to the use of gas as automotive fuel.
Kyari led NNPC to take the Final Investment Decision, FID, with the Brass Fertilizer and Petrochemical Company for the $3.6 billion Brass Methanol Plant in Odioma, Bayelsa State, which was followed by the signing of a $260 million financing agreement for the Assa-North Ohaji South Gas Projects with Seplat, and expected to deliver 300 million standard cubic feet of gas per day and 1,200 megawatts of electricity to the domestic market.
NNPC also executed a Gas Development Agreement, GDA, for the Oil Mining Lease, OML, 143 with its partner, Sterling Oil Exploration and Production Company, SOEPCo, expected to boost the nation’s gas production by 1.2 trillion cubic feet, tcf.
Downstream
In the downstream sector, Kyari introduced ‘Operation White’, which has helped in streamlining petroleum products importation, supply and distribution across the country.
As the sole importer of petroleum products in the country, NNPC has succeeded in keeping the nation well supplied.
The corporation is in the process of strengthening the products distribution system by revamping the pipeline network through a Build, Operate and Transfer, BOT, model, whose process is already at an advanced stage.
Also during his watch, NNPC signed an agreement with the Nigerian Content Development and Monitoring Board, NCDMB, and Zed Energy, for the construction of the N10.5 billion Brass Petroleum Products Terminal in the Niger Delta.
Refineries
On the refineries, he led NNPC to sign the $1.5 billion engineering, procurement & construction contract agreement with Tecnimont SpA, for the complete rehabilitation of Port Harcourt Refinery on April 6, 2021, while execution started on May 7.
Arrangements are underway to award the contracts for the rehabilitation of Warri and Kaduna refineries.
Transparency, accountability
On transparency, he promptly followed up his inaugural pronouncement with the launch of his Transparency, Accountability and Performance Excellence, TAPE.
Specifically, he caused to be published the 2018 and 2019 Audited Financial Statements of the corporation and its 19 subsidiaries registered under the Companies and Allied Matters Act, CAMA, 1990, as amended alongside that of the National Petroleum Investment and Management Services, NAPIMS, to provide clarity on Joint Venture finances. The AFS was published in the corporation’s website.
A major revelation in the audited financial statements of the two years so far published is the 99.7 per cent reduction of the corporation’s loss profile from ₦803 billion in 2018 to ₦1.7 billion in 2019, thus indicating that the corporation is likely to declare profit in the coming years
Stakeholders’ engagement
Kyari, who believes in stakeholders’ engagement, honoured invitations from the relevant committees of the National Assembly, and held periodic engagements with other critical stakeholders during the period.
COVID -19 interventions
However, following the outbreak of the Coronavirus, COVID-19, pandemic in early 2020, the GMD quickly rallied players in the oil and gas industry to raise over N21 billion to assist in tackling it, A development which prompted Boss Mustapha, Chairman of the Presidential Task Force on COVID-19 and Secretary to the Government of the Federation, to commend the Kyari-led NNPC for its various donations and strong support for the fight against the spread of the disease.
Culled from Vanguard Newspaper
