The chairman, House of Representatives Committee on Petroleum Resources (Downstream), Hon. Ikenga Ugochinyere, has said that the reforms taking place at the Nigerian National Petroleum Company Limited (NNPCL) were in line with the intention of the Petroleum Industry Act (PIA) 2021.
According to the lawmaker, the NNPCL as required under the PIA 2021, has changed its structure to a ‘commercially viable’ entity in the form of a limited liability company which has already been yielding positive results.
Ugochinyere, speaking on the sidelines of the gas distribution ceremony held in Abuja by NMDPRA, said with the enactment of the PIA in 2021, NNPCL has since made a radical departure from being a state-owned, and state-run corporation which could not deliver the expected profits to Nigerians, to a corporate entity contributing positively to the nation’s transformation as the machinery of its main source of revenue.
He said: “With the coming on board of the PIA in 2021, NNPCL has been witnessing rapid transformation for the benefit of the country unlike when it was a state-owned corporation because as it is an established fact, government is never a good runner of business so NNPCL as a company is now better off.
“The transformation at the national oil company are in line with the provisions of the law. The most significant of the changes NNPC becoming, a limited liability company to be registered with the Corporate Affairs Commission (“CAC”). Section 53 (1) of the PIA 2021 makes express provisions for the Minister of Petroleum Resources to cause the NNPC Limited to be incorporated with the CAC within 6 months from commencement of the Act. In fact, within 6 weeks of the signing of the PIA into an Act, the incorporation of the NNPC Limited at CAC had been concluded.
“By section 53 (2-5) of the PIA, the government of the Federation of Nigeria still holds full ownership of the NNPC Limited with the shares held by the duo of the Ministry of Finance Incorporated and the Ministry of Petroleum Incorporated on behalf of the government of the Federation.
“Another significant innovation is
corporate governance and annual Audit of NNPC Limited which Members of the Board of NNPC Limited are to discharge their responsibilities in accordance with the highest standards, practices and principles of corporate governance and shall ensure that its annual audit is conducted by an independent, competent, experienced, and qualified, auditor under sections 61 and 62 of the PIA.
“Also, section 63 of the PIA provides for specific responsibilities aimed at enhancing the commercial operations and best governance structure of the NNPC Limited. Generally, PIA 2021 brought a paradigm shift from the old order in terms of structure, ownership, business method, and operational efficiency.
“The implementation of the law has now position NNPC Limited as one of the best national oil companies globally and Nigerians are already reaping the benefits thereof with many investors taking the advantage of the reforms to enhance energy sufficiency through setting up of new refineries while those hitherto comatose are being revived for optimal production,” the federal lawmaker.
