President Muhammadu Buhari's war against corruption and the cleansing of the rotten system in Nigeria has begun with the planned cleansing of the Nigeria National Petroleum Company, NNPC. His choice of the NNPC as the first port of call might have been necessitated by the huge rot in the oil sector.
NRGI, an international independent body that monitors the oil and gas sector globally, in a report entitled: “Inside NNPC Oil Sales: A Case for Reform in Nigeria,” stated NNPC did not forward any revenue from the sales of Okono crude oil between 2005 and 2014.
As stated by the report, the sales totaled over 100 million barrels with an estimated value of $12.3 billion.
“In other words, the corporation has provided no public accounting of how it used a decade’s worth of revenues from an entire stream of the country’s oil production,” the report stated.
President Muhammadu Buhari kicked off the long awaited cleansing of the Augean stables of the NNPC with the sack of its Group Managing Director, Dr. Joseph Dawha and the appointment in his place of Dr. Emmanuel Ibe Kachikwu
Kachikwu who assumed duty as the Chief Executive of the Corporation penultimate week was until his appointment, the Executive Vice Chairman and General Counsel of Exxon Mobil (Africa).
The NNPC’s new helmsman on assumption of office pledged to work assiduously in achieving the president's growth aspiration for the oil and gas industry.
The sack of Dawha and the appointment of Kachikwu may not have come to many as a surprise because President Muhammadu Buhari had promised to beam his searchlight on the NNPC, which has a reputation for high level of corruption and gross mismanagement.
Indeed, Buhari, before his inauguration as the President, promised to carry out an overhaul of the corporation’s activities, just as he promised to bring all culprits to book.
The appointment of Kachikwu, an oil industry corporate player and Havard-trained lawyer, many believe will help drive the anticipated Change Team that would midwife the new government’s vision of clearing the rot in the Federal Government owned oil company.
Following this, was the sack of all eight group executive directors of the NNPC .
“The affected group executive directors are Mr. Bernard Otti, GED, Finance and Accounts; Dr. Timothy Okon, acting GED, Exploration and Production, who also doubled as the Coordinator, Corporate Planning & Strategy; Mr. Adebayo Ibirogba, Engineering and Technology; Dr. David Ige, Gas and Power; Ms. Aisha Abdurrahman, Commercial and Investment; Dr. Dan Efebo, Corporate Services; Mr. Ian Udoh, Refining & Petrochemicals; and Dr. Attahiru Yusuf, Business Development.”
Many believers in the president's anti–corruption policy hailed the new appointment and sacking of the Executive Directors as they see the development as a major step in the fight against corruption.
The corporation under Kachikwu has also stated that in a bid to restructure to a lean, efficient and business-focused organization, the management had approved and commenced the retirement of 38 senior managers.
As stated by the statement, the downsizing of staff, which saw the exit of all senior managers billed to retire from now to December, 2016, was designed to reduce cost.
“The exercise, apart from refocusing the corporation in the direction of a leaner and more efficient organization, has enormous cost-saving benefits,” it stated.
It listed the new general managers as: Mr Mele Kyari,Crude Oil Marketing Division; Ahmadu Sambo, NNPC Oilfield Services, and Dr Surajdeen Bola Afolabi, Information Technology Division/SAP.
Others are Mr Zubair Aliyu, NNPC Capital; Dafe Sejebor, Nigerian Petroleum Investment Management Services and Mrs Kemi Akitoye, Human Resources Division.
Also Mr Godwin C. Okonkwo, Finance; Bello Rabiu, Corporate Planning; Anibo Kragha, Treasury and Dalhatu Makama, Shipping.
Other group general managers are Samuel Ndukwe (Power), Mike Balami (Accounts), Yusuf Matashi (LNG), Rabiu Suleiman (Engineering and Technology) and Dr Olubunmi Oyetunde (Medical).
A hint that more sack is imminent in the NNPC was dropped by Kachikwu, who has signalled his intention to take the present restructuring of the corporation to all its cadres.
After a meeting with President Muhammadu Buhari, he stated that the ‘A to Zero’ restructuring he has embarked upon was meant to put the right personnel in the right positions for the purpose of accountability and service delivery.
As stated by him, the restructuring of the organization would be three-pronged and having completed the first two, which involved Group Executive Directors (GEDs) and Group General Managers (GGMs), attention would now be focused on the lower layer.
He also dropped the hint that there would be a forensic audit to determine the state of affairs at the corporation following which staff needing elevation, retraining and disengagement would be identified for appropriate action.
"The whole idea is to go back to being able to look at your appraisals; how well have you done in the job and if you’ve done very well, how do we elevate you to a position where you can offer more service. If you’ve not done well enough, we can retrain you and if you’ve not done well enough and there is no possibility of retraining you, we will let you go," he explained.
“At the end of the day, NNPC isn’t public service. It’s a corporation and we run like a company generating money for the people of Nigeria. And so, that whole concept of anything goes should stop. And this is the first stage of that whole process.
“It’s a three-pronged process that I am pursuing. There’s a people aspect which we are dealing with now; there is a process aspect; after the people at the right places, you are going to get forensic audit done so that we know clearly, proper forensic audit that will cover us all the way to 2014, 2015, that will be able to say to you, this is the state of the company.
“We are going to put processes and control in place, we are going to do retraining and repositioning and then, we are going to re-engage our majors and minors, all those who are active in the sector, for us to work as a team to try to take Nigeria forward. It’s going to be the process stage.
“The final stage will be the business stage, which is now looking at all the existing contracts if they are good, need to be re-kitted and redone. Look at the PSCs, what do we do going forward? Look at the challenges posed by very reduced balance sheet as a result of $40-$50 per barrel type oil, what do we do to energise recovery and income growth so that government will have money to work with?
“It is a very intensive work, very calibrated work, a lot of us are not spending time sleeping. But by the next five to six months, you will begin to see a new NNPC emerging; a new process of oil administration in the country and obviously, giving fillip to Mr President’s dream of taking the oil industry back to where it should be.”
The GMD, who did not want to be drawn into the perceived corrupt reputation of the NNPC, added: “I don’t want to over critique an institution I have taken over please. Having stated that, things have been done wrongly and things need to be done differently.
“We are doing a lot of work in terms of repositioning, restructuring, getting the right personnel in key places and setting a culture of accountability and service delivery so that the new NNPC that you are going to see will be a different institution altogether.”
On how the presidential directive for all government Ministries, Departments and Agencies (MDAs) to pay money accruing to government into a single account would affect its agreements with Joint Venture Companies (JVCs), he indicated that the NNPC may not be able to meet up with it as it would require funds to run the system.
However, he stated the corporation was looking into ways to ensure accountability and openness without jeopardising its ability to carry out its statutory duties.
His words: “All that is being looked at. The reality is that to run an oil company, you’ve got to have funds to do it. If you don’t, you close down the corporation and the production system will close down.
“So, we are looking at how to merge the need for accountability and openness with the need to make sure that the industry itself survives. We cannot throw away the baby with the bath water.”