Is NNPC really open for business?

At the recent 2017 Offshore Technology Conference (OTC) in Houston, Maikanti Baru, Group Managing Director of Nigerian National Petroleum Corporation (NNPC) said, the “NNPC is here and we are open for business.”

The national oil company have taken to critical actions to perpetuate this notion. This month, it awarded the Ajaokuta-Kaduna-Kano (AKK) natural gas pipeline project to a consortium of Chinese firms led by the Chinese Petroleum Engineering at the cost of $949 million representing 80 percent of cost of construction.

NNPC says the objective of the pipeline is to address the current operational challenges experienced in the Nigeria power sector limiting the ability of gas generation companies (Gencos) from increasing their output to due to difficulty transporting gas from the Niger Delta to power plants around the country.

According to the project tender, the contract includes a 40-inch pipeline 221 km, 2 stations and 7 valve room and its ancillary facilities. The pipeline is expected to run 187 kilometres from Ajaokuta to Abuja, 193 kilometres from Abuja to Kaduna, 65 kilometres from Kaduna to Zaria and then the rest from Zaria to Kano.

In March this year, Baru said the process for the construction of the 650 kilometres northern gas pipeline that would run from Ajaokuta in Kogi State to Kano had begun.

NNPC also has ongoing gas pipelines projects that are at various stages of completion, including the strategic 127km East-West Obiafo/Obirikom to Oben (OB3) pipeline that is scheduled for completion by the end of this year, and the looping of the Escravos-Lagos Gas Pipeline System from Warri to Lagos, which is scheduled for completion by July also this year

To cap it all, Nigeria’s national oil company two weeks ago, said it will resume drilling in the Lake Chad Basin in six weeks’ time after exploratory activities were halted on account of insurgency by Islamist extremist group, Boko haram.

Saidu Mohammed, NNPC’s chief executive officer in charge of Gas and Power, who represented Baru, disclosed this on a visit to the Borno State governor, Kashim Shettima, in Maidugiri.

Mohammed said that light and heavy duty exploration equipment were being moved into the basin to commence full oil prospecting by the end of 2017.

“We are also in the state to inform you that in the next six weeks, we are going to redeploy our team of experts back to Maiduguri to resume oil exploration with better technology in the Lake Chad Basin.

“This is necessary with our renewed efforts in harnessing, Oil, Gas and Power to increase the economy of the nation, in line with the agenda of President Muhammadu Buhari in job creation and economic diversification.”

However, NNPC would really be open for business following the model of Saudi Arabia’s biggest oil company, Saudi Aramco. The world’s largest oil exporter, plans to sell as much as 5 percent of Aramco in 2018 as part of a plan to set up the world’s biggest sovereign wealth fund and reduce the economy’s reliance on oil.

Since King Salman acceded to the throne in 2015, the kingdom changed its oil minister and the top Aramco leadership. The company has formed a supreme board to oversee its affairs, led by the king’s influential son, Deputy Crown Prince Mohammed Bin Salman. The prince has been the driving force behind the Aramco IPO plans.

Besides the sale of the IPO, Saudi Arabia seeks to double refining capacity and expand natural gas and chemical businesses ahead of what could be the world biggest share sale. This model represents the best example of what it means to be open for business.

ISAAC ANYAOGU