There is a raging debate on the future of state-owned oil agency, the Nigerian National Petroleum Corporation (NNPC) and its downstream sector. The debate was sparked by the People’s Democratic Party (PDP) presidential candidate, Atiku Abubakar’s proposal to privatize NNPC if elected President. He was convinced that his proposal proffers a tangible solution to the challenges that have dogged the oil agency. He declared in a recent engagement with the business community in Lagos that he would rather accept death than not follow through with his plan.
But his proposal was torn into shreds and painted as a “dangerous intention for Nigeria” by the ruling All Progressives Congress (APC), who suggested the former vice-president is out to enrich his ‘friends’ with the sale of the NNPC. As much as APC railed at Atiku over his proposal and rallied for its rejection, APC struggled to convince Nigerians on steps taken so far in the last three years or propositions to make the oil agency transparent and accountable.
It is not unexpected that Nigerians may be confused on the real issue at stake but before they are misguided to take a naive stand on the debate, they should pause a bit and ask themselves a simple question; who does NNPC really serve?
NNPC was founded in 1977 and focused on exploration activities, as well as interest in refining, petrochemicals, products transportation as well as marketing.
From the highlighted responsibilities, it is clear enough that NNPC is positioned to facilitate the local supply of petroleum products, especially PMS, through the four refineries under its purview, and even more expressive, a major revenue recipient for the country. In a plain word, NNPC was set up to serve the generality of Nigerians, no matter their status.
But activities of the firm over the years has raised doubts in the minds of Nigerians on whether it is fulfilling its set objectives. The NNPC has allowed the four refineries under its management work fall into disrepair, hence relying on fuel importation to meet up local consumptions, the opaque and brazen impunity in the administration of resources it holds in trust for the nation has been disappointing. It is shocking to note that Nigeria is still the only OPEC nation that imports petroleum products and pays trillions of Naira in subsidy.
Every year, trillions of Naira continue to be expended on the subsidy of petrol, wasting resources that would have been better spent building schools, hospitals, roads, waterways, railways, mass housing etc if the NNPC was running efficiently, and more importantly, in a transparent manner. It is unfortunate that investments on activities that could directly enhance the lives of the poor masses are continually being sacrificed to facilitate subsidy payment, which only benefits the few privileged Nigerians.
With these glaring inadequacies and continuing waste by NNPC, one is beginning to ask if this is the right way for us to hold on as a nation. For the over 40 years that NNPC has been left to manage the country’s interest in the oil sector, there is no disputing that rather than the deserved benefits that come with our abundant oil resources, Nigeria, and by extension, citizens have been losing more revenue to ineffectual and corrupt management. In fact, Nigeria is expending more than it earns on importation of petroleum products it ought to be producing locally, costing it resources that should have gone into developmental projects.
Maybe the time has come for us to drop our sentiments and take a closer look at what Atiku proposal on NNPC is all about. In his policy document and most public gatherings where he had discussed the proposal, Atiku could accurately analyse the underlining factors that dwindle the oil firm effectiveness and transparency. He was so passionate to explain the danger of retaining the order and tabled his proposal as the ideal way of saving Nigeria scarce resources and ensure steady access to petroleum products.
Obviously countering the narratives that his proposal was intended to ‘enrich friends’, Atiku made it explicitly clear that the sale of the NNPC and its refineries will be handled by the Nigerian Stock Exchange (NSE), where every Nigerian will have the opportunity to buy into it. He went further to include in his policy document that there would be a limit to stock a single individual, no matter how rich, would be allowed to subscribe to, which is a means to ensure no individual or groups will have controlling shares to begin to dictate what happens in the organisation.
Even more imperative is that Atiku’s proposal on NNPC is no different from the new Petroleum Industry Bill (PIB) that many have pressed both the Buhari Presidency and National Assembly to ensure passage. Just as Atiku’s proposal indicated, the PIB is tailored towards the divestment of NNPC and refineries, raising confusion on why Atiku proposal is bad but the PIB is not. The passage of PIB will see government handing off 90 percent of its stake in NNPC to private investors through the NSE, which quite align with what Atiku indicated in his plan if he is elected President.
Subsequently, it is clear that some people are being mischievous or deliberate in misleading Nigerians on the proposal of Atiku because what he plans to do on NNPC is the reality we could no longer shy away from. Nigeria is in her current struggling situation because citizens have continued to allow sentiments to overrule reality, making it easier for politicians to deceive them for votes. But Atiku has chosen the honourable path to sincerely engage citizens of his plan to overcome some of the country’s problems.
NNPC is critical to the sustenance of Nigeria as it is responsible for generating over 70 percent of government revenues and about 90 percent export earnings, making it pertinent for a radical approach that will purge it of corruption and opaqueness that has costed Nigeria fortunes over the years. From time to time, we are confronted with huge revenue loss through mismanagement and disregard for accountability by cronies of people in power.
Instead of the unnecessary criticisms that had trailed the Atiku proposal on NNPC, the ideal thing is to seek more information on timeline of implementation and insist that he follows through with his promise of ensuring no individual or group has a controlling power in the ownership of the oil firm. In all honesty, handing NNPC and sub-sectors to private hands would made them more profitable, pay more taxes, create more jobs and be able to compete with their peers both locally and Internationally. Beyond sentiments, Atiku’s plan on NNPC is clear enough to evoke support of Nigerians as it didn’t only provide solutions to past economic challenges, but will also opened up a broader economic potential for the country.
Op–ed pieces and contributions are the opinions of the writers only and do not represent the opinions of Y!/YNaija
Oke Umurhohwo is a Political Analyst and Strategist as well as a member of the PDP.