By Adewole Kehinde
Sahara Reporters goofed again when they alleged the inappropriateness of the disengagement of the NNPC GMD, Mallam Mele Kyari, and NNPC GED F&A, Mr Umar Ajiya, from the services of the old corporation and their subsequent appointment by President Buhari to commence a new tenure as Group CEO and CFO in the new NNPC Limited.
It seems Sahara Reporters has not changed from its lazy journalism because they should have realized that Public Service Rules require termination of a fixed-career appointment in favor of a new tenured role.
I want to remind Sahara Reporters that with the passage of the Petroleum Industry Act and the successful transition of the Nigerian National Petroleum Corporation to a commercially driven national energy company, the NNPC Limited needs the likes of Kyari and Ajiya.
Sahara Reporters should know that the Group Managing Director and Group Executive Director F&A’s careers with the Nigerian National Petroleum Corporation ended in line with the provisions of the PIA and the appropriate government circular.
Specifically, Section 59(3) of the PIA 2021 has stipulated the conditions to be considered in appointing the CEO and CFO of NNPC Limited without recourse to previous employment ranks in the corporation. The previous rank of GMD or GED F&A was therefore not a consideration in the appointment of the CEO or CFO of NNPC Limited.
The PIA 2021 has, in addition to the creation of NNPC Limited, made clear and explicit provisions relating to governance, administration, and the appointment of a chief executive officer (CEO), a chief financial officer (CFO), and a board of directors by President Buhari.
The PIA 2021 is deliberate about the long-term sustainability of the 20-year-long petroleum industry reform that climaxed in the creation of NNPC Limited as a commercially driven national energy company with a focus on sustainable value creation.
To quote the Chief Corporate Communications Officer, NNPC Limited Abuja, Garba Deen Muhammad. He said, “Under the provisions of the Act, the appointment of the CEO and CFO of NNPC Limited by the President of the Federal Republic of Nigeria is based on distinct terms and conditions of Service including tenure, employment benefits and termination. The appointment of CEO and CFO is not a career posting as erroneously presented by Sahara Reporters”.
“Consequently, by virtue of the appointments of Mallam Mele Kyari and Mr Umar Ajiya as NNPC Limited Group CEO and CFO respectively by Mr President for a tenure of five years each with effect from 16 September 2021 have ended their employment with the Corporation and are thus entitled to their terminal benefits in respect thereof. Based on the provisions of the Act, the new tenured roles they assumed with NNPC Limited cannot be regarded as a continuance of their previous positions in the defunct corporation”.
“For further clarity on the misrepresentation of facts by Sahara Reporters, the Circular issued by the Head of the Civil Service of the Federation, dated 27 July 2009, has explicitly stated that appointments as Chief Executives of Government-Owned Companies are “tenured appointments”, and in respect of such tenured appointments, career officers who wish to take up such appointments shall retire from service, to run their tenure uninterrupted. The circular recognizes a distinction between a tenured appointment to serve as Chief Executive of a government-owned company, as distinct from a career office.
“Public service rules require termination of any fixed career appointment to take up a tenured role.
“It is therefore our belief that the informed general public will disregard the misinformation and misrepresentation of facts published by Sahara Reporters. NNPC compensation does not pay gratuity into billions and we are a compliant organization that is committed to delivering greater value to Nigerians in strict compliance with extant laws and circulars.
Mele Kyari is well qualified for his new position as the Group CEO of NNPC Limited.
He is a hard-working gentleman with a perfect magical touch, full of versatile knowledge, ideas and experience, which he has used to transform the NNPC from what it was to an exceptional powerhouse in Africa and the world over.
Immediately he assumed office as the 19th GMD of the then NNPC, this focused and visionary leader rolled out what he called TAPE (Transparency, Accountability and Performance Excellence) a blueprint to ensure the continued success of the NNPC both at home and overseas. Just a few years into his stewardship, Kyari has made a significant increase to the national crude oil reserves to achieve the 40,000-billion-barrel target through focus and commitment. The NNPC GCEO has pushed up exploration work in some basins and drilling of certain oil wells. The drilling of Kolmano River II & III wells, Seismic data collection in the Bida and Sokoto Basins are a few examples.
With the national crude oil reserves on the high side, the nation’s oil production was pursued with one sole aim, which was to boost its production to a target of three million barrels daily, through peaceful negotiations. Similarly, production shortages revolving around oil blocks were dealt with, while sabotage that was decreasing the country’s oil production was accurately managed. Concerning the country’s oil production, Kyari led NNPC Limited to a future investment worth N10bn for the development of the Bonga South-East Field after reaching a peaceful conclusion and agreement on a deep offshore block, OML 118.
The GCEO has led the NNPC Limited to secure several alternative funding facilities for the NPDC and some of the Joint Venture’s projects to facilitate the further development of assets. These include the N875.75m NPDC OML 65 Alternative Funding and Technical Services package with CMES-OMS Petroleum Development Company and the $3.15bn Alternative Financing Package with Sterling Exploration and Energy Production Company Limited (SEEPCO) and other partners for the development of NPDC’s OML 13.
To reduce the burden of petrol importation, Kyari made sure the NNPC Limited keyed into the decade of gas initiative, led by Timipre Sylva, the former Minister of State for Petroleum Resources, to launch the autogas initiative. Kyari’s foresight led him to invest heavily in the gas sector in a bid to effectively change the nation’s trajectory to a gas-driven economy. This was done with the signing of the NLNG Train 7 project, a future promising project, with the hope of delivering over $20bn in revenue to the government and the creation of 50,000 direct and indirect jobs. With the Russia-Ukraine crisis, Nigeria is now on the verge of being one of the world’s largest gas-exporting countries all over Africa and Europe.
It is also on record that the Kyari-led NNPC Limited saw the successful commencement of the construction of the Ajaokuta-Kaduna-Kano (AKK) gas pipeline project with a saving of $300m from the initial amount. The AKK project has the capacity of making available around 2.2 billion cubic feet of gas per day with the expansion of the pipeline systems to double delivery capacity from 1.5BCF/D to over 3.5BCF/D.
To fully cater for the demands of gas domestically, the GCEO also commissioned the Oredo Integrated Gas Handling Facility (IGHF) and the Liquefied Petroleum Gas Storage and Dispensing Unit, with the ability to deliver over 200 million standard cubic feet of dry gas per day and 330 metric tonnes of Liquefied Petroleum Gas (cooking gas) which is equivalent of 16 units of 20 tonnes LPG trucks per day into the domestic market.
Similarly, Kyari saw to the Final Investment Decision (FID) of the Brass Fertiliser and Petrochemical Company for the $3.6bn Brass Methanol Plant in Odioma, Bayelsa State. He also spearheaded another investment with the signing of a $260m financing agreement for the Assa-North Ohaji South (ANOH) Gas Project with Seplat, promising about 300 million standard cubic feet of gas per day and 1,200 megawatts of electricity to the domestic market. The NNPC Boss also facilitated the United States Trade and Development Agency (USTDA) Grant which will assist in the upgrade of the 1350MW Abuja Independent Power Project to World Bank Standard for bankability.
Since Nigeria relies heavily on petroleum products importation, proper measures were needed to manage its importation, supply and distribution to get to Nigerians without difficulties where ever they may be within the country, hence Kyari introduced “Operation White” which has ensured a steady fuel supply. This explains the fastest detection of the root cause of fuel scarcity that hit the country in the early months of this year. It was quickly detected that there were cargoes with high methanol content. Immediately, the methanol-blended petrol cargoes were removed from the market and this was what created the vacuum that led to petrol scarcity.
In response to the scarcity, under the leadership of Kyari, NNPC Limited imported a huge quantity of petrol that bridge the supply gap created and in no time, normalcy was returned and the scarcity disappeared.
The rehabilitation of refineries is another key area where Kyari has performed very well, investing billions for the reviving of the long deteriorating refineries that have been in a state of neglect. The Port Harcourt, Kaduna and Warri refineries are all marked for rehabilitation. This, he did, to reduce the cost of importing petroleum products for the country and create more jobs for the teeming youths.
The NNPC has also invested in the Dangote Refinery, which is set to produce 650, 000 barrels of crude petroleum daily, making it the largest such refinery in the world. As such, it will meet the country’s demand for 57 million litres of petrol per day, 27 million litres of diesel daily, 11 million litres of kerosene daily and nine million litres of aviation jet per day.
It is instructive to say that this investment is timely and in tune with the new direction and structure of the NNPC as a public limited liability company. Furthermore, this will strengthen the domestic refining capacity and improve the petroleum products supply from local refineries. This is one of the six refineries in which the NNPC Limited seeks to invest in line with the vision of improving domestic refining capacity, strengthening petroleum products supply from our local refineries and becoming a net exporter of petroleum products to give the economy a more solid boost.
Kyari also provided an oil reservoir to save the country in terms of its needs until things revert to normal. Under his watch, the passage of the Petroleum Industry Act came to be, after the country has not been able to have this legislation for almost two decades despite its importance. The Petroleum Industry Act provides for the transitioning of the NNPC into a fully commercial entity, a Limited Liability Company incorporated under the Companies and Allied Matters Act (CAMA), known as the Nigerian National Petroleum Company Ltd.
Just as the World Bank had advised, Kyari believes that subsidy removal, though a tough decision, will end up helping the government financially and doing better for the economy, as it will boost investments across the oil and gas sector.
In the area of financial transparency, Kyari made public the audited financial statements of the NNPC LIMITED, with the Company recording its first-ever profit in its 44 years history. Subsequently, the management continued with the Publication of the Corporation’s Monthly Financial & Operations Reports (MFOR) in line with his TAPE vision, thus placing the NNPC Limited as the only national oil company that publishes its financial and operations reports monthly globally.
As far as Transparency is concerned, the GCEO spearhead the enlisting of the NNPC Limited with the Global Extractive Industry Transparency Initiative as an EITI Supporting Company which places NNPC Limited in the group of over 65 extractive companies, state-owned enterprises that commit to observing transparency and accountability standards defined by EITI.
The Kyari’s stewardship also saw the construction and rehabilitation of 21 roads under the FG’s Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme. The provision of jobs and inclusion of relevant stakeholders is another area the GCEO has placed his magical touches on, aside from the recruitment of over a thousand graduate trainees. Indigenous Nigerians were also engaged in carrying out jobs for the NNPC Limited.
Still, under the able leadership of Mallam Mele Kolo Kyari, the NNPC has commenced the construction of a 50-megawatt gas turbine power plant, the Maiduguri Emergency Power Project (MEPP), expected to generate electricity for the capital city and its environs following the sabotage of the existing facilities by insurgents.
The GCEO’s achievements have been reflected in all areas, even outside the oil and gas sector as during the outbreak of the COVID-19 pandemic, he facilitated the sum of N21bn from the oil and gas sector to support the COVID-19 fight. Under the leadership of Kyari, 26 per cent of the fund was deployed for the provision of logistics and in-patient support equipment such as ambulances, ventilators, isolation centres, etc.
Other notable achievements of the exceptional NNPC GCEO include the implementation of various International Financial Reporting Standards (IFRS) 9, 15 and 16 across NNPC Limited Group to ensure regulatory compliance as well as the implementation of the Centralized Invoice Processing System, integration of systems, applications and products to Remitta, SAP Funds management and issued conditions for financial autonomy of NNPC Limited SBU.
The GCEO’s administration has also inaugurated the NNPC Limited Delivery Team charged with the responsibility of ensuring the effective performance tracking of the top five priorities across the business as well as launching the NNPC Limited Code of Conduct and Tip Portal. Also, Kyari launched the Nigerian Upstream Cost Optimization Programme (NUCOP) to drive down the cost of crude oil production in the country to remain competitive in the global market.
These are some of the achievements of the GMD for the period he has steered the ship of the NNPC Limited. Indeed, the GCEO is the best man for the Job. To his credit, he has received awards such as Most Accountable and Transparent Government Agency Meritorious Award” from an online news medium, Swift Reporters. the Group Managing Director of the Nigerian National Petroleum Company Ltd, the Leadership Newspapers Group Chief Executive Officer of the Year award for 2021, Sun Man of the Year and CEO of the Year at the African Energy Awards.
A winner of the Prestigious African Leadership Magazine’s 2020, Special African Business Leadership Award and a recipient of an Honorary Doctorate Degree in Engineering. Kyari is surely not the first GMD of the NNPC, but he has certainly proven himself to be the best, using his vast wealth of experience to revolutionise the oil and gas sector, showing an exemplary, unique and rare leadership style. These qualities fully explain all the efforts, sacrifices, and transparency, the GCEO is making to transform the oil and gas sector to a standard that can stand the challenges of this present time.
Indeed, with Kyari, the dream, hope and vision of leading the oil and gas sector in the continent and around the world is not only alive but close to realization.
To give support to Mele Kyari, the President appointed Umar Ajiya as the Chief Financial Officer of NNPC Limited.
Mr Ajiya is a seasoned Finance and Business Management Professional with practical experience in Corporate Financing, Business Strategy, and Commercial and Stakeholder Management. He has over 33 years of experience in the Oil and Gas Industry and is a fellow of the Association of National Accountants of Nigeria (ANAN), the Institute of Credit Administration (ICA), the Chartered Institute of Taxation of Nigeria (CITN) and the Nigerian Institute of Management.
He started his career in 1988 with Elf Petroleum (now TotalEnergies) and later joined the Nigeria Liquefied Natural Gas Limited in 1991 where he contributed significantly to raising finance for the NLNG Vessels and Trains.
He also made his mark in the marketing of LNG. He rose to occupy several positions including the Head of Treasury, Finance and Marketing & Business Development.
In 2012, he joined NNPC as GM, Commercial in the LNG Division where he established LNG marketing JVs.
Before his elevation to Chief Financial Officer of NNPC in July 2019, he was the Head of Corporate Planning & Strategy of the NNPC Group and later the Managing Director of the Petroleum Products Marketing Company (PPMC). As MD of PPMC, he championed the company’s transformation from a loss-making entity to a profitable one in 2018, for the first time in its 28 years history.
Mr Ajiya’s key achievements within NNPC include the development of new business models for NNPC Autonomous Business Units in 2016, the transformation of PPMC to a profitable entity, and securing financing for key NNPC strategic projects across the upstream, midstream and downstream between 2019 and 2021.
He also championed the restructuring of the NNPC Accounts in the wake of the Petroleum Industry Bill (PIB) aimed at broader reforms including the full commercialization of the NNPC. This resulted in the first declaration of profit in 2020 by the Corporation in its 44 years of history. Following the enactment of the Petroleum Industry Act (PIA) in August 2021, Mr Ajiya was appointed the CFO and a member of the Board of NNPC Limited.
The astute CFO supported the GCEO and other NNPC Senior Management Teams in sustaining NNPC’s profitability trajectory with an increase of over 200% in the 2021 fiscal year.
Mr Ajiya also sits on the Boards of several subsidiaries of NNPC as well as other external organizations including the Federal Inland Revenue Service and the Nigeria Extractive Industries Transparency Initiative (NEITI).
He is an advocate of Transparency, Accountability and Performance Excellence. Mr Ajiya has attended several courses at home and abroad including colleges and global business schools such as Cambridge, Insead, IESE and the Wharton Business School, amongst several others.
Adewole Kehinde is an Energy Expert and Fellow of the Abuja Chamber of Commerce and Industry Policy Centre. He can be reached via 08166240846, kennyadewole@gmail.com
