The Nigerian National Petroleum Company Limited (NNPCL) is an animal that eats its curator for lunch. To survive it, either do not get close or prepare to feed this beast with an endless supply of oil deals, the country’s lifeblood.
When former Governor Nasir El-Rufai accused NNPCL of being a parallel government and added that if Nigeria does not kill NNPCL, corruption will kill it, he was right.
After the bazaar of the former Petroleum Minister Diezani Allison-Madueke era, and those before it, the hope was that President Muhammadu Buhari would use his wealth of experience to fix NNPCL. His junior Petroleum Minister, Ibe Kachikwu, swore that he would resign if the refineries didn’t work in two years, yet left them in a worse state. Buhari’s government killed corruption in NNPCL by yielding to it.
A ’village’ problem’?
After over 35 years in the oil industry, with a significant part of it in leadership roles in Shell Petroleum, Bayo Ojulari knew NNPCL before he was appointed group chief executive officer in April. He knew the place was rotten and that his reformist agenda would be tested. Yet, the general public reaction to his appointment was positive, with the expectation that after the squalid Mele Kyari years, defined mainly through keeping politicians happy, Ojulari would use his expertise to fix the rot.
Four months in, while Ojulari’s solid technical credentials remain intact, his political naivety might ruin him and any hopes of redeeming the NNPCL. I’m not concerned about the Senate Public Accounts Committee’s investigations into alleged discrepancies in the NNPCL’s audited financial statements between 2017 and 2023, insinuating that over N210 trillion was unaccounted for.
That happened long before Ojolari’s tenure. Except that sensational reports about missing oil trillions are testosterone-fueled for press headlines. They also strengthen the hands of politicians who have perennially used NNPCL as a honeypot. But the Committee Chairman, Senator Ahmed Aliyu Wadada, and his members know it’s nonsense.
Wadada and all-what-not
Audit queries are not unusual in accounting, and issuing threats over a six-year “unaccounted” sum that focuses mainly on assets and not liabilities is foolish. Of course, when politicians are involved, you can’t rule out strategic foolishness. But if push comes to shove, it’s not only NNPCL that will be held accountable. The IOCs, joint venture partners, will also have questions to answer.
Next, there’s the matter of Abdullahi Bashir Haske, a contractor, allegedly linked to Ojulari in deals estimated at either $21 million or $31 million, depending on whoyou believe.
This gets a bit curiouser because Haske has made statements to the security services. Haske is not new to NNPCL. His company, AA&R Investment Group, has, among other things, provided mainly helicopter services for nearly 20 years, especially for the five or six locations where the company is currently involved in frontier drilling across the country.
The Haske-Atiku angle
The problem with Haske is two-fold, each fold highlighting Ojulari’s naivety. Reports indicate that even though Haske’s company had had problems with NNPCL over some turnkey projects, it was to Haske that Ojulari turned to provide jets that flew the board and management for a retreat in Kigali, Rwanda. If there had been a lull in Haske’s business with NNPCL, Ojulari’s tenure has been something of a Haskean revival. Some reports estimated the jet hire service cost of the Kigali trip to be over N1 billion – hardly a prudent expenditure for a reformer in a bleeding company.
This “indiscretion” might have been forgiven if Haske were not the son-in-law of former Vice President Atiku Abubakar, a connection which, if Ojulari claims, is unknown to him or doesn’t matter, only means his naivety is of ghastly proportions.
Ojulari may wish to remember what Sun Tzu said in The Art of War about making the enemy toil when he is relaxed, and starving them when they’re full. Atiku knows Ojulari should know the government doesn’t consider him a friend. If Ojulari does not know that even an appearance of redemption of “the enemy” by proxy will not go unnoticed, then he doesn’t know anything.
Or was it Rowland?
There have been unverified suggestions that the testy relationship between Ojulari and NNPCL GCOO, Rowland Ewubare, may also have played a role in the current turbulence. Or that some key former staff, especially the managing directors of the three refineries – Warri, Port Harcourt and Kaduna – who were fired by Ojulari, may be stirring the pot. Probably.
Where the truth lies
Two things, according to insiders, which go to the heart of Ojulari’s problem are 1) the failed Saudi Aramco $7.5 billion loan, and 2) lingering displeasure over the sale of ExxonMobil assets to Seplat last year. The Saudi Aramco $7.5 billion oil-backed loan predated Ojulari’s assumption of office. It started in 2023.
The problem was that while earlier discussions with Riyadh were around 20,000 bpd to back the loan, some vested interests, with an eye on two-and-a-half percent interest, raised the trade-off by six times. Ojulari later opposed, arguing that piling 120,000 bpd on the current raft of forward pledged oil-backed deals was unsustainable. President Bola Ahmed Tinubu backed him, making it unlikely that Nigeria would continue with the deal.
As surely as outrage attracts company, losers from the Aramco deal teamed up with their angry cousins in the Seplat $1.3 billion ExxonMobil (Seplat bought the asset over deeply bruised egos), and the rest is misery.
Beyond Ojulari
But seriously, this is not just an Ojulari problem, however partly self-inflicted. Nigeria is sick, and a Band-Aid would not make it whole. Saudi Aramco, from which Nigeria seeks an oil-backed loan, started drilling in 1935, but it became Saudi Aramco by royal order only in 1988. Today, it is the world’s largest integrated energy and chemicals company with a net income of $106.2 billion in 2024.
NNPCL’s contemporaries, such as the Abu Dhabi National Oil Company (ADNOC), have a market capitalisation of $12.89 billion. In contrast, one of its major subsidiaries, ADNOC Gas, has a much higher value of $70 billion. Petronas (Malaysia), only three years older than NNPCL, has a solid global footprint in oil and gas. In Africa, national oil and gas companies such as Sonatrach (Algeria) and Sonangol (Angola) continue to demonstrate that things work where people are serious.
The Petroleum Industry Act (PIA) is the boldest effort in decades to make Nigeria’s oil and gas sector work for investors, communities and the country. It has brought some structural improvements and regulatory clarity. But Nigeria, being Nigeria, this bold effort has been hampered by regulatory and administrative bottlenecks, underinvestment and infrastructure deficits, security and operational risks, and legal and institutional challenges.
Fix it or leave it!
The suggestion that a company like NNPCL, with a board and shares currently being held 50-50 by the Ministry of Finance and the Ministry of Petroleum Incorporated in trust for Nigerians and overseen by the National Assembly, is controlled from some bedroom may be seductive, but unconvincing.
Whatever the obstacles before him, with the support of the board and the President, Ojulari will have no excuse if he fails to fix the NNPCL. If the current baptism of fire hasn’t taught him a lesson or two, nothing will. Not the enemies within. Not the contractors. Not the politicians in the National Assembly. Not the vested interest, planted and rooted. Certainly not the paramours, real or imagined.
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