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Tag: Dr. Ibe Kachikwu

  • Fuel price will go down, says Kachikwu

    Fuel price will go down, says Kachikwu

    Minister of State for Petroleum Resources, Dr. Ibe Kachikwu said Thursday that the price of petrol will come down in a few months.

    Speaking a Channels television programme Thursday morning, he said: “As it gets better and it gets to a point where we find that the market has stabilised in terms of supply, we will begin to pull back a bit in terms of determinants for pricing.

    “You will be amazed at what will happen to your N145 price because it will go downwards.

    “You don’t give what you don’t have. We want Nigerians to understand that we feel the pain, and we have tried to avoid it since I came in October. We have done everything we could.

    “We first went on to the issue of the subsidies that we inherited which, by the way, were based on 50 to 55 million litres consumption, and we said the number looked bloated. So, we did an experiment and came to a conclusion that this country doesn’t consume more than 45 million litres a day.

    “Then we came to a second point and said, ‘We are not even going to have subsidy again. We are going to exit it because there was just too much fraud involved in it.

    “So, left with that option, what were we supposed to do? We have struggled. Queues continue to go and they are back. And it will continue to happen unless we address the issues.

    “If you free up Nigerians to find sources of funds, they will find those secondary funds. They will import the product; the burden on the NNPC will reduce and the country will have peace and subsidy will go away permanently.

    “I am appealing to Nigerians to please for the first time realise that we are doing our very best. I have together with everybody who is in this government worked night and day looking for solutions.

    “We mean well and Nigerians should please trust us. Give us a chance; you will be surprised what will become of your PMS price over the next six to eight months.”

     

  • TMG wants Kachikwu to resign over hike in fuel price

    TMG wants Kachikwu to resign over hike in fuel price

    The Transition Monitoring Group, TMG Thursday demanded the immediate resignation of the Minister of State for Petroleum Resources and the Chief Executive of the Nigerian National Petroleum Corporation, NNPC,  Ibe Kachikwu over the hike of the price of Petrol.

    The TMG in a statement issued in Abuja Thursday and signed by its Chairman, Ibrahim Zikirullahi said it “stoutly rejected  the N145 pump price of petrol imposed by Federal Government”

    TMG said, “to  say the least, this imposition portrays the government as insensitive, and out of touch with the daily unbearable plight of the ordinary Nigerian.

    “Coming at a time when the implementation of the recently signed 2016 Budget, is yet to take off, the hike in the face of groaning and pains, is ill-timed and badly advised.

    “It is tantamount to killing a willing horse to ask the Nigerian people, who are already carrying the heavy burden of the failure of governance over the years, to take on one more load of extreme economic hardship, as represented by the imposed price of petrol.

    “As a grassroots coalition, which has tried to rally patriotic support for the anti-corruption crusade and other government initiatives, which we believe would make the lives of Nigerians better, we must stress that our support of the government is conditioned by the impact of its policies on the long suffering people of this country.

    “Our allegiance is to the Nigerian people, and whenever they come under the hammer blows of insensitive policies, we are duty-bound to speak up in defence of ordinary citizens.  As is the case with this latest hike, we must place it on record that it is absolutely anti-people.

    “TMG will join forces with Labour and other activists to resist this hike. With the many economic woes afflicting the country, including job losses, massive unemployment and galloping-inflation, the least we expected the government to do was to give Nigerians a breather, and allow some form of recovery to take place through a stimulus package injected into the economy to rev it back to life before placing any further burdens. To our utmost disappointment however, ordinary Nigerians have been hung out to dry, and left at the mercy of shylock fuel importers. These importers who can mobilize funds to import petrol, but cannot invest in refineries, are the ones being given a free rein to exert profit from the blood and sweat of ordinary citizens.

    “The Nigerian people feel particularly let down by the unending flip-flopping of the Minister of State for Petroleum Resources, Ibe Kachikwu. Kachikwu’s chameleonic pronouncements on the fuel situation over the past months have left many Nigerians befuddled. One minute he is declaring that refineries have started production, the next minute, he is telling the nation all manner of cock and bull stories about strategic reserves, and the effect of the activities of economic saboteurs. We wonder why ordinary Nigerians would be made to bear the brunt of the crimes of economic saboteurs, whom government with all its might is not ready to deal with.

    “This endless prevarication has kept Nigerians in the dark about the real issues in the oil and gas sector. Kachikwu’s trumpeted move to unbundle the Nigeria National Petroleum Corporation was touted by him as panacea to the issues in the oil and gas sector. As it stands it has all become motion, at the expense of real impact. As if to add insult to injury, Kachikwu’s announcement of the hike failed to provide any road map towards ending importation of petrol, which is the root cause of the current crisis. On the basis of these and many more indiscretions, TMG calls on Kachikwu to immediately throw in the towel, as he has serially demonstrated a lack of understanding of the issues in the oil and gas sector. TMG calls on all Nigerians to reject this insensitive hike in the price of petrol, and prepare for mass action to send a clear message that this imposition cannot stand,” the statement said.

  • Nigeria to begin exportation of fuel by 2019 – Kachikwu 

    Nigeria to begin exportation of fuel by 2019 – Kachikwu 

    Minister of State for Petroleum, Dr. Ibe Kachikwu has said that, the federal government in its efforts to permanently end fuel crisis in the country is to build three more refineries in Kaduna, Port-harcout and Warri.

    He said when that is completed as planned by 2018, Nigeria will start exporting refined petroleum products for the first time since inception by 2019.

    This was also as he promised that, every household in the country will get free gas cylinder before the end of next year, to stop over dependence on kerosene.

    The Minister who doubles as the Group Managing Director of Nigerian National Petroleum Corporation (NNPC) stated these while addressing Nigerians at the Town Hall Meeting organised by the Federal Ministry of Information in Kaduna on Tuesday.

    According to Kachikwu, “More refineries have to be built, and the target is to build three more refineries to be located in Kaduna, Potharcout and Warri taking advantage on the share facilities.

    “And if we do this, by 2018 if all our refineries are working we will drop importation by 60 percent. And by 2019 if the four located refineries begin to work and am sure they will, we will actually begin to export petroleum product for the first time in this country.

    “Let me start by apologising for the difficulties you been experiencing in terms of getting fuel.

    “Having arrived Kaduna this morning from Lagos, I did a quick tour of Kaduna metropolis. Although the situation is improving but I felt sad still that some areas around the metropolis are not getting the product especially that you have a refinery.

    “But the realities about the situation is that wherever I turn when I was appointed I found problems when.

    “The refineries were not working when I was appointed in October. If I turn to the pipelines, they were not in existence. If I turn to the upstream, there no funding. So production was sliding.

    “If I turn to the NNPC structure, there was massive issue of transparency that everybody talked about. And if I turn to what the future was to Nigeria, I saw the solution rather than hope.

    “So, I took over the mantle under these circumstances. But I was not discouraged because the President is committed to surmounting the problems.

    “This is the first time we have two refineries working simultaneously in the last Eight years. For the first time in 20 years we are working to restructure the NNPC.

    “On the fuel issue, the reality is that as long as these refineries don’t work in absolutely top capacity, as long as we don’t have the foreign exchange to bring in the products, as long as the price of crude continues to slide, and part of my responsibility is getting it up.

    “As long as such conditions continue, we will have problems with fuel. So we have to apply brain work to it.

    “Do, I want to see the problems continue? No. There is a lot of improvement but there is a lot of work require. And in the next three months I assure you will see great improvement in terms of fuel supply.

    “Most importantly, we need to begin to developed massive infrastructural support in this country. The pipelines must get to work, got to get investors to invest in them because we do not have the money to build them up.

    “For the upstream sector where production has been climbing down, our target is to move production up to 2.3 Million barrel, but I am personally committed to 2.5 million barrel.

    “The blowing of pipelines cannot drive us back, we are committed. The days of hopelessness have passed, the days of careless expenditure are passed, the days of corruption are going, and we are heading to the future were we can deliver a country we can all be proud of,” he explained.

    He however promised that, “to improve our marketing outlets, we are building about 700 marketing outlets all over the country, one per local government. And we are asking the state governments to give us land to do this.  We are building multi big stations with shopping malls, which will beef up activities in the local government areas.

    “We have the concept of providing free gas cylinders to every Nigerian household, which will be roll out next year so that we can pull Nigerians away from the use of Kerosene to cleaner fuel,” he promised.

    However, before rounding off his address,  Kachikwu asked everybody in the hall to stand up, holding hands together and recite the following: “we are Nigerians, we are made by our common destiny, our purpose, our country is bless in ways unimaginable, we as Nigerians are not limited by hope, not limited by resources, not limited by talent, not limited by aspirations. Our nation has had its challenges but we remain abundantly bless, so today, this moment, now going forward, we join hands across our land, hands across our tribes, hands across our religion, hands to our leaders and our followers. And as Nigerians unite in struggle, we have decided to build  the Nigeria of our dreams, a Nigeria of less criticism but creativity, a Nigeria of abundant not scarcity, a Nigeria unify not fraction, a Nigeria transparent not fraudulent, a Nigeria with abundant dreams, aspirations and delivery. Today, this moment, we stand on treasure of history to built the new Nigeria of our dreams.”

     

  • Fuel scarcity: CNPP issues seven-day ultimatum to end queues

    Fuel scarcity: CNPP issues seven-day ultimatum to end queues

    The Conference of Nigeria Political Parties (CNPP) Thursday issued a seven-day ultimatum to the Ministry of Petroleum Resources to end fuel queues cross the country.

    CNPP warned that at the end of the ultimatum, it will mobilize the organized labour, civil society groups and the masses to occupy the Nigerian National Petroleum Corporation (NNPC) until the minister and minister of state resign.

    This was contained in a statement jointly issued in Abuja by its National Chairman, Alhaji Balarabe Musa, who was the Second Republic Governor of old Kaduna State and the Secretary General, Chief Willy Ezugwu.

    The group maintained that: “Both the Minister and Minister of State for Petroleum Resources have shown a track record of undeniable and monumental ineptitude in resolving the problems associated with Fuel Scarcity in the last 11 months.

    “While the Minister of State for Petroleum Resources and Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Dr. Ibe Kachikwu has kept double talking on the issue, the Minister and President Muhammadu Buhari on his part has maintained relative silence.

    “About seven months ago, Kachikwu had confessed: “Personally, I will have chosen to sell the refineries, but President Buhari has instructed that they should be fixed.

    “After they are fixed, if they still operate below 60 per cent, then we will know what to do.’

    “A 90-day presidential ultimatum for the refineries to be fixed ended in December and the deadline was not met.

    “In the same vein, the government set April 7 deadline to end the fuel queues being experienced across the country, again, the deadline was not meet.

    “After blaming some people who rather than sell products send them into hinterlands where they can sell at ridiculous prices to make quick returns on their investments wrongly, the Ministry few days ago blamed the scarcity on 30% of supply allegedly diverted outside Nigeria.

    “The government should be reminded that it has all the security apparatus and personnel to tract the saboteurs and bring them to justice.

    “Enough of all the blame games and lack of will to tell Nigerians the truth about the lingering fuel scarcity. If by the end of seven days, and the situation is not addressed, the CNPP shall have no choice but to lead the organized labour, coalition of civil society groups and the Nigerian masses to occupy NNPC until the minister and minister of state resign their positions in the Ministry,” the statement added.

  • Fuel scarcity: Mega Marketers threaten to expose saboteurs

    Fuel scarcity: Mega Marketers threaten to expose saboteurs

    Association of Mega Filling Station Owners of Nigeria, AMFSON, has told the Minister of State for Petroleum, Dr. Ibe Kachikwu that if they are pushed to the wall they will mention the names of his subordinates sabotaging his efforts to end fuel crisis.
    This was as it said that heads will roll in the oil industry if they go ahead to mention names.
    Addressing a press conference yesterday over plight of members of the Association to access fuel after several months of depositing millions of Naira for supply, National Secretary of AMFSON, Kenneth Nwachukwu said his members had in recent past resisted the urge to mention the saboteurs even when the Minister insisted they mention names.
    Nwachukwu alleged that several trucks of fuel had been diverted into black markets by these perceived saboteurs at the detriment of mega stations owners and Nigerians in general.
    He pointed out that it was for incident of fuel scarcity that the immediate past government established mega affiliate stations in order to cushion its negative effect on Nigerians, and urged the Minister who is also the Group Managing Director to address plight of AMFSON members to help in ending the fuel crisis.
    He said, “The minister said we should mention names, but you know Nigerians, when you come out in public to mention names of the saboteurs, they can go after you, so it is something that if it is possible to do one on one with the Minister, we can tell him, there is nothing to be feared because we have evidence of how fuel is being diverted into the black markets, we have evidence of everything we are saying about this fuel crisis.
    “The Minister said we should mention names that if we mention names the persons will not last 24 hours. But it is not proper to mention names in public, we are giving information, it is left for the Minister to go underground and work on the information and get to the root of what we are saying. We cannot come out to the market place and say this person is a thief. We don’t do things like that, but if we are pushed to the wall and mention names, heads will roll at NNPC Retail.
    “One of the ways to end this fuel crisis is for the Minister to come down to our own level and discuss with us, get the whole truth of the people that are sabotaging his efforts. If they supply fuel to our affiliate stations, there will be no scarcity again. This is what the immediate past government was doing with us in time like this.
    “The NNPC Retail will take this fuel meant for us to the black market, and still end up spoiling our names as if we are the one diverting the fuel, the fuel that was not delivered to us, but distributed somewhere else in our names. This is corruption in the highest order.
    “We are now crying out, we met twice with the Minister of State for Petroleum, Dr. Ibe Kachikwu, and we told him that NNPC Retail staffs have refused to bring us into the mainstream of fuel distribution. But they can’t be the accused and the Judges, and everything at the same time.
    “The petroleum product belongs to the government, it belongs to the people, so these staffs should not keep it to themselves, we should know how it is being distributed. We should know the quantity that is available, and we should know that this is the quantity you are giving to us being the marketers, you cannot wake up one morning and say you gave us five million trucks. Who did you give them to?. Nobody knows.
    “Sometimes it is our names they used in bringing out that product, but it never got to us.
    “When we met the Minister for the first time, around October last year, we discovered that the NNPC Retail staffs deceived him to embark on building new 800 filling stations, but it does not make sense to build 800 stations when the old ones on the ground have not been serviced.
    “So when we met him, we told him about our own plight, that these staffs believe that NNPC Retail belong to them, and not to Nigerian people, they believe that it is their birthright, staffs that are earning salaries.
    “We told the Minister of our problem that these staffs refused to work with us as an Association, they prefer to work with us on individual basis, so that if you are dying as an individual, you can’t talk, and if you talk, they drive you out of the business. Since there is strength in unity, they don’t want to deal with us as an association.
    “So the Minister told them in our presence he saw nothing wrong for them to work with us as an association than as an individual. He said that they should go and work with us. So we left.
    “May be they went back to poison the Minister’s mind because since that time our problem became worst, they just abandoned us completely. For more than six weeks now, some us deposited N10 million, we cannot access fuel. So how can we keep quite over these issues.
    “Again, we wrote to the Minister, and we met, and he was seriously disturbed by what is happening.  We reported back to him that NNPC Retail staffs have refused to with our association. And he was furious and asked them what is wrong with working with our association.
    “The Minister therefore told them to go and set up a committee that will comprise our own members so that we should be able to monitor the product, even if it means offloading the product at a particular depot from where we can load our own supply.
    “The minister handed our issue to a new Chief Operating Officer (COO) who now told us that he will call for dealers meeting and not association meeting. But we were surprised at this because we are registered association, so nobody can stop us from being an association. This matter had dragged us and the NNPC Retail to the National Assembly, where the Senators settled the matter that we have 600 mega stations and the Corporation has only 37 Mega Stations, and that we should be given a supply too even if it is 50 to us and 50 to them.
    “Sometimes you see 10 trucks of fuel packed at Mega 1, while none of our members has fuel. And by night the Mega 1 will sell off these 10 trucks to the black market.
    “You cannot solve fuel scarcity in this way unless you allow the supply to go round. But you pack 10 trucks in one place, whom are you deceiving, and by night you send the trucks to the black markets,” Nwanchukwu explained.
  • Don’t separate offices of Minister of State Petroleum, GMD NNPC – Group

    Don’t separate offices of Minister of State Petroleum, GMD NNPC – Group

    The Niger Delta Youths Coalition on Tuesday opposed the call for the separation of the office of the Minister of State for Petroleum from that of the Group Managing Director of the Nigeria National Petroleum Corporation (NNPC).

     

    The NDYC in a statement made available to our reporter in Abuja said that the insinuation that the combination of the two offices as presently constituted is too demanding for the Minister of State, Petroleum Resources, Dr. Ibe Kachikwu, lacked substance and is not founded on facts.

     

    Endorsed by Comrade Ebipade Jackson (Bayelsa), Comrade Eghosa Idehen (Edo State), Comrade Tony Gbemudu (Delta State), Comrade Amezhinim Ekiye (Rivers State), Comrade Aniebiet Nsikan (Akwa Ibom State) and Comrade Odey Christopher (Cross River State) statement said that the merger of the two offices is also not the cause of the current fuel scarcity.

     

    NDYC said that it is on record that the relationship between the two offices when they were separate, was characterized with friction, power tussle and policy inconsistency.

     

    It added that fuel scarcity had been a perennial occurrence in the country’s history at those times when the offices of Minister of State for Petroleum and the GMD of NNPC were under separate management, as was the case in the era of Funsho Kukpolokun, Austin Oniwon, Andrew Yakubu, Joseph Dawha, and others.

     

    “We wish to condemn in strong terms the call by the President of the Trade Union Congress, Mr. Bobboi Kaigama for the separation of the office of the Minister of State for Petroleum from that of the Group Managing Director of the NNPC because, according to him, the office as presently constituted is too demanding for Dr. Kachikwu.

     

    “Such an argument lacks substance and is not founded on facts. The merger of the two offices era of Funsho Kukpolokun, Austin Oniwon, Andrew Yakubu, Joseph Dawha, and others.

     

    “It is common knowledge that the cause of the present fuel scarcity is as a result of the inability of fuel importers to source enough foreign exchange for the importation of fuel.

     

    “The Central Bank should as a matter of urgency grant these fuel importers access to foreign exchange to alleviate the pains being experienced by all as a result of the scarcity of petroleum products.

     

    “We wish to utilize this opportunity to call on the ordinary Nigerian to rally round Ibe Kachikwu.

     

    “It is on record that Dr. Kachikwu has made some far-reaching changes since assumption of office.

    “His re-engineering of the NNPC to make it more profit oriented and a veritable revenue earner for Nigeria is a great feat which past administrations failed to achieve.

     

    “As a matter of fact, the NNPC has been running at huge losses over the years and was mostly dependent on the finances of the country for sustenance.

     

    “Another major feat recorded by Dr. Kachikwu is the jettisoning of the fraud called fuel subsidy which had served as a drain pipe on the resources of this country for years.

     

    “Available records show that fuel subsidy payments gulped over N5 trillion between 2011 and 2015. With the recent down-grading of the fuel subsidy regime, the system is now free for fair and competitive businesses that can grow the economy unlike in the past where a very few held the system hostage and continually made false declarations on the quantity of products brought into the country.

     

    “Dr. Ibe Kachukwu has been very proactive in the management of the Petroleum sector since assumption of office and we urge him not to be deterred because  President Muhammadu Buhari’s change agenda as is being brilliantly prosecuted by Dr. Ibe Kachikwu through revolutionary policies geared towards revamping the oil and gas sector.

     

    “We also want to use this opportunity to thank and commend His Excellency Muhammadu Buhari for finding in Dr Kachikwua worthy change agent who has the capacity and skills to deliver on the determination of his administration to restore hope to Nigerians.

     

    “We therefore thank Mr President for his unwavering support for Dr. Ibe Kachikwu’sprogrammes in the petroleum sector since assumption of office and urge him to discountenance and disregard all negative insinuations which without doubt, are borne out of greed and mischief.

     

     

    “South South people are solidly behind Dr. Ibe Kachikwu and we remain profoundly proud of his outstanding achievements in life, including the giant strides he has already recorded in the Nigerian oil and gas sector where, on resuming office, he has characteristically grabbed the bull of corruption and inefficiency by the horns, and began a transformation of the NNPC to a modern and more efficient oil company.

     

    “We finally urge Dr. Ibe Kachikwu to remain focused and unrelenting in his commitment to justify the confidence placed on him by Mr President.

     

    “Dr. Ibe Kachikwu remains one of our best brains in the Niger Delta region and we are glad to note that this administration recognizes the importance of engaging our best unlike in the past, to head sensitive positions in government and thus bring good governance to bear not just on the Niger Delta region but in Nigeria as a whole.

     

    “For the avoidance of doubt, it must be put on record that for the first time in the history of this country, the era of profligacy in the management and administration of the oil sector is now over and this is as a result of the dexterous application of the world acclaimed professional skills of a sincere and honest administrator, against all the odds placed on his way by devious persons in the industry who are opposed to the change agenda.”

  • NSCDC officers to check fuel hoarding nationwide

    NSCDC officers to check fuel hoarding nationwide

    The Commandant-General, Nigeria Security and Civil Defence Corps (NSCDC), Abdullahi Gana Muhammadu on Monday disclosed that the corps had commenced deployment of personnel from all state command nationwide for proper surveillance of fuel supply across the country.

    He said the gesture was an effort to stem diversion of the product.

    Muhammadu who disclosed this during an interactive session with newsmen in Abuja noted that the move was in line with the federal government’s resolve to tackle the issue of fuel diversion which has caused monumental hardship on Nigerians.

    According to him, “The diversion of the fuel remained a major challenge in the country and that is why the deployment of personnel in all state command across the country becomes imperative to put an end to the lingering fuel scarcity. The era of fuel diversion is over. This step will remain a continuous exercises till the situation is normalized. NSCDC is more determined to chase sabotage out of business including tanker drivers, independent and major oil marketers.”

    The CG stated that the latest arrangement between the corps and the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu was to ensure that the corps station his men strategically across the country to ensure that every truck from the depots get to their final destinations, while efforts are in place to provide adequate tracking system to monitor the movement of trucks.

    He said the corps was also exploring new ways to monitor and protect pipelines, especially the use of technology and sophisticated gadgets to track down vandals. “I can assure you that we are already exploring new approaches which will include the massive deployment of technology as opposed to conventional approach.”

    The NSCDC boss, who decried the spate of oil diversion and oil theft in the country, said the corps was working round the clock to stem the tide.

    Muhammadu attributed illegal diversion to corruption in the country and act of economic sabotage by criminal elements.

    He stated that the act was driven by desperation for material acquisition at expense of Nigerians.

    The commandant-general while assuring that the NSCDC would continue to do its best to ensure the security of lives and property in line with its mandate called on the media, host communities and other stakeholders to cooperate with the NSCDC and other security agencies in tackling the menace.

  • Normalcy will soon return to filling stations – NUPENG

    The National Union of Petroleum and Natural Gas Workers (NUPENG) on Wednesday assured that normalcy would soon return to filling states nationwide if the current tempo of loading at the depots continued till the weekend.

    Alhaji Tokunbo Korodo, the South-West Chairman of the union, gave the assurance in an interview with the News Agency of Nigeria (NAN) in Lagos.

    Korodo said that the NNPC commenced massive pumping of petrol to its depot at Mosinmi early this week and loading of petroleum trucks had started.

    “Going round some depots in Lagos, I observed that loading was going on and more filling stations are selling the product at the control price.

    “Some filling stations that are selling between N130 and N150 will be forced to sell at control price when the market is flooded with petrol.

    “If NNPC can keep the tempo of the loading till weekend, more filling stations will have petrol and the queue of motorists at filling stations will reduce.

    “The corporation should ensure that it keeps on pumping petrol to both major and independent marketers’ depots to reduce the scarcity,” he said.

    The chairman appealed to NNPC management to ensure that it carried along all stakeholders in the oil and gas sector so that the fuel scarcity could end as promised.

    Korodo urged the corporation to maintain the current loading system at depots.

    NAN reports that the Minister of State for Petroleum, Dr Ibe Kachikwu, on March 29, said that the long queues in the petrol stations would disappear by April 7.

    Kachikwu made the statement when he appeared before the Senate Committee on Petroleum (Downstream) over the lingering fuel scarcity in the country.

    He apologised to Nigerians over his statement that the fuel scarcity would linger till May.

     

  • Senate backs minister on NNPC restructuring

    Senate backs minister on NNPC restructuring

    The Senate Thursday threw its weight behind the Minister of Petroleum Resources,(State)  Dr. Ibe Kachikwu’s decision to restructure the Nigeria National Petroleum Corporation(NNPC).

    Senators said that they are satisfied with the measures taken by the minister to restructure the corporation especially when no law was breached in the process of carrying out the restructuring.

    The lawmakers however scolded Kachikwu for his failure to consult the National Assembly before carrying out the controversial exercise.

    Three standing committees of the Senate grilled Kachikwu on the motive behind the restructuring of the NNPC.

    Senator Tayo Alasoadura, Chairman Senate Committee on Petroleum (Upstream) and Vice Chairman, Senate Committee on Petroleum (Downstream), Senator Jibrin Barau and Chairman, Senate Committee on Gas, Senator Bassey Albert Akpan, conducted the session which later moved into a closed session.

    Alasoadura told reporters after the closed session that they are satisfied with the measures taken by the minister aimed at making units of the NNPC more functional.

    The Ondo Central lawmaker added that Kachikwu did not breach any law in carrying out the restructuring,

    Senate Chief Whip, Senator Olusola Adeyeye (Osun central) who led the question-and-answer session noted that the Act that established the NNPC especially cap1, 23© 1d gave the NNPC management free hand to operate as an entity.

    Adeyeye said that the Act however did not give them the power to create autonomous firms that would be independent of the NNPC.

    He also said that the Act clearly stated that the affairs of the NNPC must be conducted by a board.

    A member of the committee, Senator, Chukwuka Utazi (Enugu North), urged the minister to go head with far reaching restructuring of the NNPC.

    Senator Utazi who insisted that change in the NNPC was long over due, said the Minister should not mind vested interests in the oil and gas sectors who were working to compromise necessary changes in the NNPC.

    Utazi said, “Mr. Minister, you must understand the sort of resistance that would come when you want to change things. But you must continue doing what you are doing. Don’t be deterred; don’t be tired of the reforms you are carrying out.  We understand what you are doing. Just go on with what you are doing we are behind you.”

    Another member of the Committee, Senator Biodun Olujimi, said that government must have human face in its actions.

    Olujimi said that there was no doubt that the minister by his action has effectively pre-empted the passage of the Petroleum Industry Bill (PIB).

    She wondered why the restructuring was conducted without recourse to the National Assembly.

    Senator Emmanuel Paulker in his contribution said that the minister should have carried unions in the industry along.

    Paulker noted that if the NNPC was shut down for any reason, the economy of the country would be adversely affected.

    He said that there was no reason for the minister not to have consulted the National Assembly before carrying out the measures.

    Senator Stella Oduah, (Anambra North) wondered why such huge restructuring of the NNPC would be carried out without the knowledge of the National Assembly.

    She also underscored the issue of aging equipment in the oil and gas industry.

    Kachikwu insisted that what his ministry did was not unbundling, but restructuring.

    He also said that it is not true that the exercise was carried out without the approval of a board and the Federal Executive Council, as stated in the Act.

    He said that the approval process began long age.

    The minister said that the real chairman of the NNPC Board is the Minister of Petroleum.

    He said that with the measures taken by the ministry, there will slightly be less control from the head office.

    He noted that other than aging equipment, the refineries, for instance, have not been given the independence they required to operate.

    “He said, “You cannot bring in loanable funds into the refineries because for you to bring loanable funds you have to have the cash flow to fund the loan.”

    The minister said that there is already a committee of staff and management in the NNPC looking at the measures being taken by the ministry.

    The NNPC Act Part 1, states in part that:

    “It shall be the duty of the Corporation, from time to time, when the National Council of Ministers so requires or the Corporation considers it appropriate to undertake a general review of the affairs of the Corporation and of any subsidiaries thereof for the purpose of determining how the management of the activities of the Corporation or any subsidiary thereof can most efficiently be organised and, where appropriate, to make a report to the National Council of Ministers upon the Corporation’s conclusions arising from the review.

    6.(1)The Corporation shall have powers to do anything which in its opinion is calculated to facilitate the carrying out of its duties under this Act including, without limiting the generality of the following, the power –

    (a)to hold, manage and alienate movable and immovable property;

    (b)to purchase or otherwise acquire or take over all or any of the assets, businesses, properties, privileges, contracts, rights, obligations and liabilities of any other company, firm or person in furtherance of any business engaged in by the Corporation;

    (c)to enter into contracts or partnerships with any company, firm or person which in the opinion of the Corporation will facilitate the discharge of the said duties under this Act;

    (d)to establish and maintain subsidiaries for the discharge of such functions as the Corporation may determine; and

    (e) to train managerial, technical and such other staff for the purpose of the running of its operations and for the petroleum industry in general.(2) Notwithstanding subsection (1) of this section, any contract relating to any project of a value of more than N5,000,000 (or such higher limit as may be directed from time to time by the National Council of Ministers) shall be referred by the Corporation to the National Council of Ministers for approval before the award of any such contract is made by the Corporation.

  • NNPC scraps crude swap deal

    NNPC scraps crude swap deal

    • To save $1b from initiative

    The Minister of State for Petroleum Resources and Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Dr. Ibe Kachikwu, has said the crude-for-products exchange arrangement popularly referred to as crude swap will be replaced by a Direct-Sale–Direct-Purchase (DSDP) arrangement which would take off next month.

    Dr. Kachikwu spoke when he appeared before the House of Representatives Ad-Hoc Committee set up to investigate the Corporation’s offshore processing and crude swap arrangement between 2010 to date at the National Assembly Complex, Abuja.

    A statement endorsed by the Group General Manager, Group Public Affairs Division, NNPC, Mr. Ohi Alegbe, explained that the minister noted that the DSDP was adopted to replace the Crude Oil Swap initiative and the Offshore Processing Arrangement (OPA) so as to introduce and entrench transparency into the crude oil for product transaction by the state-run oil firm in line with global best practices.

    Under the old order, crude oil was exchanged for petroleum products through third party traders at a pre-determined yield pattern.

    The Minister said the DSDP option eliminates all the cost elements of middlemen and gives the NNPC the latitude to take control of sale and purchase of the crude oil transaction with its partners adding that the initiative would save $1billion for the Federal Government.

    “When I assumed duty as the GMD of NNPC, I met the OPA and like you know, there is always room for improvement. I and my team came up with the DSDP initiative with the aim of throwing open the bidding process. This initiative has brought transparency into the crude-for-product exchange matrix and it is in tandem with global best practices,” he said.

    According to him, the DSDP initiative whittles down the influence of the minister in the selection of bid winners as it allows all the bidders to be assessed transparently based on  their global and national track record of performance before the best companies with the requisite capacities are selected.

    He said the policy is aimed at reducing the gaps inherent in OPA and the losses incurred by the NNPC in the past.

    He stated that the new arrangement would help the Corporation to grow indigenous capacity in the international crude oil business and create job opportunities for indigenous companies that are selected.

    The GMD said the DSDP initiative gives other government agencies such as the Bureau of Public Procurement (BPP) and Nigeria Extractive Industry and Transparency Initiative (NEITI) the opportunity to be part of the bidding process in order to engender adherence to due process.

    Speaking on some of the reported misgivings by some federal agencies over alleged non-transparent nature of past crude-for-products exchange arrangements, the minister assured that the reconciliation process was ongoing and that going forward the Ministry would deploy technology to track cargoes and trans-shipment at the reception depots in order to forestall any incidence of round-tripping.

    Dr. Kachikwu said the price modulation policy has rid the Federal Government of the burden of subsidy on imported petroleum products in January this year.