Opinion

My thought on the controversial $26 billion contract awarded by NNPC

By Muyiwa Olayinka

Why this high handedness at the cash cow of Nigeria, NNPC?
It is becoming a recurring decimal. When and how is it going to stop?

By institutional framework……..,
Nigeria National Petroleum Company (NNPC) is the cash cow of Nigeria.

It is a state monopoly that generates almost 75% of the federal government’s revenue. In a letter written by the Minister of state ( Petroleum), and leaked to the press, Dr Ibe Kachikwu accused the Group managing director of NNPC, Mr Baru, of awarding contracts of $26 billion without due process. Mr Baru was accused of sidelining the board of NNPC in awarding these contracts.

This is a big blow to this government that makes the mantra of fighting corruption. Abuse or subverting due process is an act of corruption.

From the revelations coming out, we gathered, it is more of personal aggrandizement between the two  government officials and not for altruistic or patriotic reasons

The President is the substantive minister of petroleum, that is, he’s the overall boss supervising the oil industry. With this public spats between his appointees, it portends that he’s been unable to oversee this important sector of the economy. His tardiness has brought this nation to the ridiculous level. The President cannot be excused from this shameful act, because he has made himself unavailable according to the minister of state.

In a bid to douse the tension created, the President met with the two political appointees to find out what actually happened over the weekend. If I were the President, I will relieve both of their appointments to instill confidence and send strong signals to other would be deviants in my cabinet.

This is not the first time, we hear such accusations. From time immemorial, this sector has been involved and bedeviled in under hand and shady deals.

When the current President, Major General Buhari (rtd) was a military officer, in the mid 70s, he was the federal commissioner of Petroleum with the then military government of General Gowon. N2.8 billion was alleged to be missing in the coffers of this same organization. Why money is always missing in NNPC.

Late Fela Anikulapo, a music maestro, made a song about it, asking why money dey miss? (Why is money always missing)
. Nothing has changed since that era. Late military head of state, General Sanni Abacha siphoned more than $4 billion through fictitious and shady deals from NNPC.

NNPC is a state behemoth that is involved in almost all oil related business and activities. It is in charge of all the related chains of the business. From oil exploration, retailing of petroleum products in the down stream sector and to the upstream sector. It is over burdened, with inadequate checks and balances, weak administrative structure, giving room for sharp practices.

It’s system is opaque, ubiquitous, unaccountable, and largely exploited by political leaders of successive governments to milk the nation dry. The previous government was accused of using proceeds and subsidy from oil wealth to further its political nests.

The former minister of petroleum, Diezanni Madueke is currently being investigated, home and abroad, regarding shady oil deals under her watch.

Those who accused this government of using NNPC funds to prepare the financial war chests for the general election in 2019 are not out of tune. They are relying on past experiences.

This government deliberately stalled all privatization program of National Council of Privatisation (NCP) of the previous government. The NCP supervises the Bureau of Public Enterprises (BPE), that is statutorily empowered to commercialize state owned utilities.  If the timelines of  NCP had been adhered to, Commercialisation of NNPC would have been unbundled  according to international best practices.

Former President Obasanjo had slated this organization for privatization, like its sister agencies such as  NEPA and NITEL that had been milking the nation dry. Former President Obasanjo prepared the blueprints of commercializing many state owned enterprises like NNPC, moribund NEPA ( National Electric Power Authority, the Nigerian railways, Nigeria Telecommunication Ltd NITEL and so on.
Obasanjo’s government successfully commercialized NITEL and Nigerian ports.

The privitization of NITEL brought about the revolution of GSM (Global Systems for Mobile Technology). It has revolutionized our ways of doing businesses. In the telecom sector, the Nigerian government do not invest a dime but supervises, regulates by the application of extant rules. The operators pay taxes and levies to the federal government, contributing to the national wealth. If NNPC had been fully commercialized, it would have been able to fulfill its statutory obligations,  operates as a private entity and as an ongoing concerns. It would have reined it from political manipulation that we are consistently treated.

Chief Obasanjo sold refineries, preparing NNPC for full commercialization before his tenure expired. Unfortunately, his successor, late Umaru Yar’adua, reversed the sale and stalled the full process. He slowed down the privatization of NEPA until his demise in office. It was his successor, Goodluck Jonathan that revived the the privatization of NEPA and completed it. He was at the verge of restructuring NNPC that he lost his re- election.

NNPC has continually been at the whims and caprices of political powers, deliberately set aside for political manipulation.

If this government is sincere with its change mantra, it should promptly commence the full privatization and commercialization of NNPC. This is the sincere and patriotic path that will put a stop to all this mindless looting and bickering from political appointees and politicians.

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